Interim Budget 2019-2020: Speech of FM Piyush Goyal


Interim Budget 2019-2020
Speech of Piyush Goyal
Minister of Finance
February 1, 2019
Madam Speaker, 
I rise to present the Interim Budget for the year 2019-20.

  1. I am  deeply  conscious   of   the  absence  of   Shri  Arun  Jaitley  I am sure the House joins me in wishing Shri Jaitley speedy recovery, good health and a long life in the service of the nation.
  2. Madam Speaker, the people of India gave a strong mandate to our Government. Under the visionary leadership of Hon’ble Prime Minister Shri Narendra Modi, we have given the most decisive, stable and clean Government and have undertaken transformational structural reforms. We have reversed the policy paralysis engulfing the nation and have restored the image of the country. The major achievement of this Government was that we strived our utmost to change the mind-set and ignited the self-confidence of the nation.
  3. I can proudly say that India is solidly back on track and marching towards growth and prosperity. We have prepared the foundation for sustainable growth, progress and better quality of life for all our people.
  4. We are moving towards realising a ‘New India’ by 2022, when we celebrate 75 years of India’s independence: an India which is clean and healthy, where everybody would have a house with universal access to  toilets, water and electricity; where farmers’ income would have doubled; youth and  women  would  get  ample  opportunities  to  fulfil  their  dreams; an India free from terrorism, communalism, casteism, corruption and nepotism.

State of the Economy

  1. Madam Speaker, the last  five  years  have  seen  India  being universally recognised as a bright spot of the global economy. The country witnessed its best  phase  of  macro-economic  stability  during  this  We are the fastest growing major economy in the world with an annual average GDP growth during last five years higher than the growth achieved by any Government since economic reforms began in 1991.  From  being  the  11th largest economy in the world  in  2013-14,  we  are  today  the  6th  largest in the world. Besides generating high growth rate, we contained double-digit inflation and restored fiscal balance.
  2. Inflation is a hidden and unfair tax  on  the  poor  and  the  middle  The average rate of inflation during 2009-2014 was a backbreaking 10.1%. The then Prime  Minister  admitted  as  much  when  he  said,  “We  have also not been as successful in controlling persistent inflation  as  we  would  have  wished. This is primarily because  food  inflation has increased.”  In contrast, our Govt. broke the back of back-breaking inflation. We brought down average inflation  to  4.6%  which  is  lower  than  the  inflation  during the tenure of any other Government. In  fact  inflation  in  December  2018  was down to 2.19% only. If we had not controlled inflation,  our  families  would have  been  spending  around  35-40%  more  today  on  basic necessities such as food, travel, consumer durables, housing etc.
  3. From the high of almost 6% seven years ago, the fiscal deficit  has  been brought down to 3.4% in 2018-19 RE. The  current  account  deficit  (CAD), against a high of 5.6% six  years  ago,  is  likely  to  be  only  5%  of  GDP this year. We contained the fiscal deficit notwithstanding the Finance Commission’s recommendations increasing the share  of  the  States  from  32% to 42% in central taxes, which we accepted in the true spirit of cooperative federalism, thereby transferring significantly higher amounts to the States.
  4. Due to a stable  and  predictable  regulatory  regime,  growing economy and strong fundamentals, India could attract massive amount of Foreign Direct Investment (FDI) during the last 5 years – as much as $239 billion. This period also witnessed a rapid liberalisation of the FDI policy, allowing most FDI to come through the automatic route.
  5. Madam Speaker, the last five years have witnessed a wave of next generation structural reforms, which have  set  the  stage  for  decades  of  high growth. We have undertaken path breaking structural reforms by introducing Goods and Services Tax (GST) and other taxation reforms.

Banking Reforms and Insolvency and Bankruptcy Code (IBC)

  1. The period of 2008-14 will  be  remembered  as  a  period  of aggressive credit growth and, as per RBI, the primary reason for spurt in non-performing loans and stressed    Outstanding  loans  of  public sector banks ballooned from `18 lakh crore to `52 lakh crore during this period. Many projects were started that could either not  be  completed  or had low capacity utilisation resulting in their  inability  to  pay  back  their loans. There were high stressed and non-performing  assets  (NPAs)  amounting to ` 5.4 lakh crore in 2014. Many more were hidden through restructuring or otherwise which were discovered during Asset Quality Reviews and inspections carried out since 2015.
  2. We put a stop to such questionable practices  and  stopped  the  culture of “phone banking”. The 4Rs approach of recognition, resolution, re-capitalisation and reforms has been followed. A  number  of  measures  have been implemented to ensure Clean    Through  a  transparent  and accountable process, we recognised these NPAs. The Insolvency and Bankruptcy Code has institutionalised  a  resolution-friendly  mechanism, which is helping in recovery of non-performing loans while preserving the underlying businesses and jobs. Earlier, only small businessmen used to be under pressure of repayment of loans while in the case of big businessmen, it was the headache of banks. But now, defaulting managements are either paying or exiting their businesses.  An  amount  of  close  to  ` 3  lakh  crore  has already been recovered in  favour  of  banks  and  creditors.  To  restore  the health of public sector banks, recapitalisation has been done with an investment of `2.6 lakh crore.  Amalgamation of  banks  has  also been done  to reap the benefits of economies of scale,  improved access  to capital and    to cover a larger geographical spread.

Steps against corruption

  1. We have ushered in a new era of transparency. We have given a corruption free government. The Real Estate (Regulation and Development) Act, 2016 (RERA) and Benami  Transaction  (Prohibition)  Act,  1988  are helping to bring transparency in the real estate    The  Fugitive  Economic Offenders Act, 2018 will help  confiscate  and  dispose  off  the  assets of economic offenders who escape the jurisdiction  of  the  laws  in India. Additionally, we conducted transparent auction of natural resources including coal and spectrum. We have walked the talk.


  1. As a tribute to Mahatma Gandhi’s 150th birth anniversary  in 2019,  our Government initiated  the  world’s  largest  behavioural  change  movement with the Swachh Bharat Mission. India has achieved 98% rural sanitation coverage and as many as 45 lakh villages have been declared “Open Defecation Free.” It is a holistic programme and has succeeded in changing the mindset of our people. With the people participation, they transformed it from a Government Scheme to a national movement. I thank the 130 core people of the nation for the success of Swacch Bharat Abhiyan who adopted it whole heartedly.

Poor and backward classes

  1. The poor have the first right on the resources of the nation. The Government while maintaining the existing reservation for SC/ST/Other Backward Classes, have now ensured 10% reservation in educational institutions and Government services for poors. In these institutions, around 25% extra seats (approximately 2 lakh) will be provided so that, there is no shortfall of presently available/reserved seats for any
  2. To provide food grains at affordable prices to the poor and middle classes, about `1,70,000 crores were spent in the year 2018-19 which is almost double the amount of ` 92,000 crores spent in the year 2013-14. We ensured that everyone gets food and none goes to sleep hungry. `60,000 crores are being allocated for MGNREGA in BE 2019-20. Additional amount would be provided if  required.
  3. We have worked to bridge the urban-rural divide in the country. Hon’ble Members in this August House,  most  of  whom  are  from  rural areas, will agree that several times in the past, only empty promises have  been made to people living in our villages. During the last five years, we have undertaken targeted expenditure to improve their quality of life in all its dimensions. Our aim, is to provide urban facilities in villages while keeping the soul of rural life intact.
  1. Under the  Pradhan  Mantri  Gram  Sadak  Yojana,  construction  of rural roads has been tripled. 15.80 lakh habitations  out  of a total of 17.84  lakh habitations have already  been  connected  with  pucca  roads  and  work is going on to complete the rest very soon. Pradhan Mantri Gram Sadak  Yojana (PMGSY) is being allocated ` 19,000 crore in BE 2019-20 as against 15,500 crore in RE 2018-19. There was time when a child used to reach school after walking on a foot trail, today the situation has changed and a bus can reach her/his village During the period 2014-18, a total number of 1.53 crore houses have been built under the Pradhan Mantri Awas Yojana.
  2. Till the year 2014, about 2.5 crore families were forced to live the life of 18th centuary without electricity. Under ‘Saubhagya Yojna’, we provided free electricity connection to almost every household. By March, 2019, all willing families will get electricity connection. In mission mode, we have provided 143 crore LED bulbs with the participation of private sector. This has resulted into a savings of approximately ` 50,000 crore per year in electricity bills of poor and middle class families.
  3. Madam Speaker, past five years have seen  massive  scale  up  of health care. Earlier, a poor man used to be in dilemma whether to fulfil daily needs of the family or save the life of an ailing member. This situation has deeply pained our Hon’ble Prime Minister. We launched the world’s largest healthcare programme, Ayushman Bharat, to provide medical treatment to nearly 50 crore people. Already  close  to  10  lakh  patients  have  benefited  for medical treatment which would have cost them ` 3,000 crore  through  free treatment made available under the scheme. Lakhs of poor and middle class people are also benefiting from reduction in the prices of essential medicines, cardiac stents and  knee  implants,  and  availability  of  medicines at affordable prices through Pradhan Mantri Jan Aushadhi kendras.
  4. There are 21 AIIMS operating or being established in the country presently. 14 of these 21 AIIIMS have been announced since 2014. I  am  happy to announce setting up of new the 22nd AIIMS in Haryana.
  1. The Aspirational Districts Programme is providing targeted development to the 115 most backward districts of the country. The programme has achieved notable  results  with  improved  performance  on  all indicators – health and nutrition, education, agriculture and water resources, financial inclusion and skill

Farmer’s progress and Increase in Income

  1. Madam Speaker, our hard working farmers were not getting the full value of their produce. With an aim to double the income of farmers, our Government, for the first time in history has fixed the minimum support price (MSP) of all 22 crops at minimum 50% more than the cost.
  2. Agriculture continues to be the main driver of  the  rural    Our hard-working farmers, supported by pro-farmer policies of our Government in the past four and half years, have produced agriculture commodities in record quantities. Declining  prices  of  agricultural commodities in the international market and fall in food inflation  in  India since 2017-18, relative to non-food sector, have however, reduced  the  returns from farming. Small and fragmented land holding on account of repeated divisions has also contributed in decline in  the  income  of  the farmer family. Hence, there is a need for  providing  structured  income support to the poor land-holder  farmer  families  in  the  country  for  procuring inputs such as seeds, fertilizers, equipment, labour etc.  and  to  meet other needs. Such  support  will  help  them  in  avoiding  indebtedness  as well and falling into clutches of money lenders.
  3. To provide an assured income support to the small and marginal farmers, our Government is launching a historic  programme  namely “Pradhan Mantri KIsan SAmman Nidhi  (PM-KISAN)”.  Under  this  programme, vulnerable landholding farmer families, having cultivable land upto 2 hectares, will be provided direct income support at the rate of 6,000 per year. This income support will be transferred  directly  into  the bank accounts of beneficiary farmers, in three equal instalments of ` 2,000 each. This programme will be funded by Government of India. Around  12 crore small and  marginal  farmer  families  are  expected  to  benefit  from  this. The programme would  be  made  effective  from  1st  December  2018  and the first instalment  for  the  period  upto  31st  March  2019  would  be paid during this year itself. This programme  will  entail  an  annual  expenditure of ` 75,000 crore.
  4. PM-KISAN would not only provide assured supplemental income  to the most vulnerable farmer families, but would also meet their emergent needs  especially  before  the  harvest    PM-KISAN  would  pave  the way for the farmers to earn and live a respectable living.
  5. I propose  an  outlay  of   `  75,000   crore   for   PM-KISAN   for   the   FY 2019-20. I am also providing  ` 20,000 crore  in the  Revised Estimates  of  FY 2018-19.
  6. During the last five years, for providing affordable loans to farmers, the amount of interest subvention has been doubled. The crop loan to farmers increased to `68 lakh crore in year 2018-19. We have made genuine efforts to remove the hardships of farmers by providing them Soil Health Cards, quality seeds, irrigation scheme and Neem Coated Urea to remove shortage of fertilizers.
  7. Animal Husbandry and Fisheries sector also needs considerable support. I have increased the allocation for Rashtriya Gokul Mission to `750 crore in the current year itself. I announce setting up of “Rashtriya Kamdhenu Aayog” to upscale sustainable  genetic  up-gradation  of  cow  resources  and to enhance production and productivity of cows. The Aayog will  also  look after effective implementation of laws and welfare schemes for cows.
  8. India is the second largest fish producing nation in the world accounting for 6.3% of global production, registering an average  annual growth of more than 7% in recent years. The sector provides livelihood to about 1.45 crore people at the primary level. To provide sustained  and focused attention  towards  development  of  this  sector,  our  Government has decided to create a separate Department of Fisheries.
  9. In the last Budget, our Government announced the facility  of  extension of Kisan Credit Card scheme (KCC) to Animal Husbandry and  Fisheries farmers. Now, I propose to provide the benefit of 2% interest subvention to the farmers pursuing the activities of animal husbandry and fisheries, who avail loan through Kisan  Credit    Further,  in  case  of  timely repayment of loan, they will also get an additional 3% interest subvention.
  10. To ensure provision of easy and concessional credit and to bring all farmers under KCC fold, our Government has decided to initiate a comprehensive drive with a simplified application form.
  11. When natural calamities strike,  farmers  are  generally  unable  to repay their crop loans. Presently, the crop loans are rescheduled for such affected farmers and  they  get  benefit  of  interest  subvention  of  2%  only  for the first year of  the  rescheduled    Our  Government  has  now decided that all farmers affected by severe natural calamities, where  assistance is provided from National Disaster Relief Fund (NDRF), will be provided the benefit of interest subvention of 2% and prompt repayment incentive of 3% for the entire period of reschedulement of their loans.

Labour and Workers Dignity

  1. Madam Speaker, our Government firmly believes that workmen and all the people working in Government services should get benefit of the fast growing economy. During the last five years India has witnessed industrial peace.
  2. High growth and formalistation of the economy has led to the expansion of employment opportunities as shown in EPFO membership,  which has increased by nearly 2 crore in two years reflecting formalisation of the economy and job creations.
  3. After submission of the 7th Central Pay Commission Report, the recommendations were implemented immediately. The New Pension Scheme (NPS) has been liberalized. Keeping the contribution of the employee at 10%, we have increased the Government contribution by 4% making it 14%. Maximum ceiling of the bonus given to the labourers has been increased from 3,500 pm to ` 7,000 pm and the maximum ceiling of the pay has been increased from ` 10,000 pm to ` 21,000 pm. The ceiling of payment of gratuity has been enhanced from ` 10 lakhs to ` 20 lakhs. During the last five years the minimum wages of labourers of the all categories have been increased by 42%, which is the highest ever. The ceiling of ESI’s eligibility cover has been increased from ` 15,000 pm to ` 21,000 pm. Minimum pension for every labourer has been fixed at ` 1,000 per month. In the event of death of a labourer during service, the amount to be paid by EPFO has been enhanced from ` 2.5 lakh to ` 6 lakh. Under Anganwadi and Asha Yojana honorarium has been enhanced by about 50% for all categories of workers.
  4. Half of India’s GDP comes from the sweat and toil of  42  crore  workers in the unorganised sector working as street vendors,  rickshaw  pullers, construction workers, rag pickers, agricultural workers,  beedi  workers, handloom, leather and in numerous other similar occupations. Domestic workers are also engaged in big numbers. We must provide them comprehensive social security coverage for their old age. Therefore, in addition to  the  health  coverage  provided  under  ‘Ayushman  Bharat’  and life & disability coverage  provided  under  ‘Pradhan  Mantri  Jeevan  Jyoti  Bima Yojana’ and ‘Pradhan Mantri Suraksha Bima Yojana’, our Government proposes to launch a mega pension yojana namely ‘Pradhan Mantri Shram-Yogi Maandhan’ for the unorganised sector workers with monthly income upto ` 15,000. This pension yojana shall provide them an assured monthly pension of ` 3,000 from the age of 60 years on a  monthly contribution of a small affordable amount during their working age. An unorganised sector worker joining pension yojana  at  the  age  of  29  years  will have to contribute only ` 100 per month till the age of  60  years.  A  worker joining the pension yojana at 18 years,  will  have  to  contribute  as little as `55 per month only. The Government will deposit equal matching share  in  the  pension  account  of  the  worker  every  month.  It  is  expected that at least  10  crore  labourers  and  workers  in  the  unorganised  sector  will avail the benefit of ‘Pradhan Mantri ShramYogi Maandhan’ within next five years  making  it  one  of  the  largest  pension  schemes  of  the  world. A sum of `500 crore has been allocated for the Scheme. Additional funds will be provided as needed. The scheme will also be implemented from the current year.
  5. Our Government is committed to reach the most deprived citizens of this country. To this end, the condition of the De-notified, Nomadic and Semi- Nomadic communities merits special attention. These communities are hard to reach, less visible, and therefore, frequently left out. The Nomadic and Semi- Nomadic communities move from place to place in search of a livelihood. The Renke Commission and the Idate Commission have done commendable work to identify and list these communities. A Committee under NITI Aayog will be set up to complete the task of identifying De-notified, Nomadic and Semi- Nomadic communities not yet formally classified. Our Government will also set up a Welfare Development Board under the Ministry of Social Justice and Empowerment specifically for the purpose of implementing welfare and development programmes for De-notified, Nomadic and Semi-Nomadic communities. The Board shall ensure that special strategies are designed and implemented to serve these hard-to-reach

Women’s development to women led development

  1. Madam Speaker, in our Election Manifesto, we  had  promised  that  we will transform the quality of life of women in rural India by providing cleaner fuel. For securing the health of  every  home-maker  in  rural  areas  and to ensure that she does not have to shed tears for cooking food  to  nourish her family, our Government embarked upon a programme to deliver 8 crore free LPG connections under the Ujjwala Yojana. More than 6 crore connections have already been  given  and  the  remaining  will  get  free gas connections by  next  year. Ujjwala is a remarkable success story of  our Government programme, defined by a bold yet practical Vision of a responsible and compassionate leadership.
  2. More than 70% of the beneficiaries of Pradhan  Mantri  MUDRA  Yojana are women who are getting affordable and collateral-free  loans  to start their own businesses. Amongst many measures, benefits of Maternity leave of 26 weeks  and  Pradhan  Mantri  Matru  Vandana  Yojana  for  pregnant women have provided financial support to women while empowering them to participate in

Empowering Youth to fulfil their potential

  1. India is amongst the most youthful nations in the world. Through Pradhan Mantri Kaushal Vikas Yojana, over 1 crore youth are being trained  to   help   them   earn   a   livelihood.   We   have   harnessed   through self-employment schemes including MUDRA, Start-up India and Stand-up India. Under MUDRA Yojana 15.56 crore loans have been disbursed amounting to `7,23,000 crore. The concept of employment is changing all over the world, now the employment generation is not confined merely to Government services or factories. With job seekers becoming job creators, India has become the world’s second largest start-up hub. We are proud of  the hard work and innovative ideas of our youth.
  1. In order to take the benefits of Artificial Intelligence and related technologies to the people, a National Programme on ‘Artificial Intelligence’ has been envisaged by our Government. This would be catalysed by the establishment of the National Centre on Artificial Intelligence as a hub along with Centres of Excellence. Nine priority areas have been identified. A National Artificial Intelligence portal will also be developed

Empowering  MSMEs  and Traders

  1. Government has undertaken many effective steps to strengthen MSME sector, which provides employment to crores of people. Recently, a scheme of sanctioning loans upto ` 1 crore in 59 minutes has been launched. GST- registered SME units will get 2% interest rebate on incremental loan of ` 1 Crore. The requirement of sourcing from SMEs by Government enterprises has been increased to 25%. Of this, the material to the extent of at least 3% will be sourced from women owned SMEs.
  2. Government e-Marketplace (GeM), created by our Government two years ago, has transformed public procurement by making it  fully  transparent, inclusive and efficient. MSMEs  have  an  opportunity  to  sell  their products through GeM. Transactions  of  over  ` 17,500  crore  have  taken place, resulting in average savings of 25-28%.  The  GeM  platform  is now being extended to all CPSEs.
  3. We have focussed on supporting domestic trade and services. Our Government has recently assigned the subject of “promotion of  internal  trade including retail trading and  welfare  of  traders, and  their employees”  to the Department of Industrial Policy and Promotion, which will now be renamed as the  Department  for  Promotion  of  Industries  and  Internal Trade.

Strengthening Defence and National Security

  1. Madam Speaker, our soldiers protect our  borders  in  tough conditions. They are our pride  and    We also respected their dignity. In our Election Manifesto, we had promised to implement One Rank One Pension (OROP). This was pending for the last 40 years  and  has  been  resolved by us. The previous Governments announced  it  in  three  budgets but sanctioned a mere ` 500 crore in  2014-15  Interim  Budget;  in  contrast we have already disbursed over ` 35,000 crore after implementing the  Scheme in its’ true spirit. The Government  also  announced  substantial  hike in the Military Service Pay (MSP) of all service personnel and special allowances given to Naval and Air Force personnel deployed in high risk  duties.\
  2. Our Defence Budget will be crossing ` 3,00,000 crore for the first time in 2019-20. For securing our borders and to maintain preparedness of the highest order, if necessary, additional funds would be  provided.

Supporting Indians across the world

  1. Today, all persons of  Indian  origin  feel  secure  that  their  motherland Bharat cares  for  them  and  at  times  of  need  will  support  India’s transformation has inculcated  a  sense  of  pride  and  respect  for Indians and persons of Indian origin across the globe. We have taken several initiatives to strengthen their connect with India, facilitate their investment in India and ease their travel.

Infrastructure development

  1. Infrastructure is the backbone of any nation’s development and  quality of life. Whether it is highways or railways or airways or even digi- ways, we have gone beyond incremental growth to attain transformative achievements.
  1. Because of ‘UDAAN Scheme’, today an ordinary citizen is also travelling by air. The number of operational airports has crossed 100 with the commissioning of the Pakyong airport in Sikkim. Domestic passenger traffic has doubled during the last five  years  leading  to  large  number  of  jobs  being created also. Today, India is the fastest highway  developer  in  the  world with 27 kms  of highways built  each  Projects stuck for  decades  like the Eastern Peripheral Highway around Delhi or the Bogibeel rail-cum- road bridge in Assam and Arunachal Pradesh have been completed. The flagship programme of Sagarmala  along  the  coastal  areas  of  the  country will develop ports for faster handling of import and  export  cargo.  For  the first time, container freight movement has  started  on  inland  waterways  from Kolkata to Varanasi. Our Government will introduce container cargo movement to the North East as  well, by  improving  the  navigation capacity  of the Brahmaputra river.
  2. Indian Railways has experienced the safest year in its history. All Unmanned Level Crossings on broad gauge network have been eliminated. Introduction of the first indigenously developed and manufactured semi high-speed “Vande Bharat Express” will give the Indian passengers  world  class experience with speed, service and safety. This major leap in wholly developed technology by our  engineers  will  give  an  impetus  to  the  Make in India programme and create jobs. Capital support from the budget for railways is proposed at  ` 64,587  crore  in  2019-20  (BE).  The  Railways’ overall capital expenditure programme  is  of  `  1,58,658    The Operating Ratio is  expected  to  improve  from  98.4%  in  2017-18  to  96.2%  in 2018-19 (RE) and further to 95% in 2019-20 (BE).
  3. India provided leadership to the global  effort  to  address  the  problem of climate    Our  commitment  to  promote  renewable  energy is reflected in setting up the International Solar Alliance, the  first  treaty based  international  inter-governmental  organisation  headquartered in India. India’s installed  solar  generation  capacity  has  grown  over  ten times in  last  five  years.  This  sector  is  now  creating  lakhs  of  new  age  jobs.
  4. India’s import dependence on crude oil and natural gas has been a source of big concern to our Government. While we have taken a large number of measures to moderate the increasing demand through usage of bio fuel and alternate technologies, urgent action is needed to increase hydrocarbon production to reduce imports. A high level Inter-Ministerial Committee, constituted by our Government, has made several specific recommendations, including transforming the system of bidding for exploration, changing from revenue sharing to exploration programme for Category II and III basins. The Government is in the process of implementing these recommendations.
  5. The people of North East have also received significant benefits of infrastructure development. Arunachal Pradesh came on the  air  map  recently and Meghalaya, Tripura and Mizoram have  come  on  India’s  rail  map for the first time. Allocation for the North Eastern Areas is  being proposed to be increased by 21% to ` 58,166 crore in 2019-20 BE over  2018-19 BE.

Digital India Revolution

  1. Madam Speaker, India  is  now  leading  the  world  in  the  consumption of mobile data.  Monthly  consumption  of  mobile  data increased by over 50 times in the  last  five    The  cost  of  data  and  voice calls in India is now possibly the lowest in the  world.  Today,  under Make in India, mobile and parts manufacturing companies have  increased from 2 to more than 268 providing huge  job  opportunities.  More  than  3  lakh Common Service Centres (CSCs) employing about 12 lakh people, are digitally delivering several services to the citizens. The Common Service Centres are expanding their services and also creating digital infrastructure in the villages, including connectivity, to convert the villages into Digital Villages. The Government will make 1 lakh villages into Digital Villages over next five years.
  2. Jan Dhan-Aadhaar-Mobile (JAM) and Direct Benefit Transfer have  been game    Bank  nationalisation  was  first  done  50  years  ago, but a large part of the country was  still  left  out  of  the  economic  mainstream with  no  access  to  formal  banking.  In  the  last  five  years, nearly 34 crore Jan Dhan  bank  accounts  were  opened.  Aadhaar  is  now  near universally  implemented.  This  has  helped  ensure  the  poor  and  middle class receive the benefits of Government schemes directly in  their bank accounts by eliminating middlemen.


  1. Entertainment industry is a major employment   To  promote entertainment industry – Single window clearance for ease of shooting films, available only to foreigners, is now going  to  be  made  available to Indian filmmakers as well. Regulatory provisions will rely more on self-declaration. We  will  also  introduce  anti-camcording  provisions  in the Cinematograph Act to control the menace of piracy.

Simplification of Direct Tax System to benefit Tax-payers

  1. Madam Speaker, for making the life of  our  direct  tax-payers  easy,  we reduced tax rates, more for the common man  and  middle  class,  and made the interface with the tax department much simpler and largely  Due to this, the tax collections increased significantly from ` 6.38 Lakh  crore  in  2013-14  to  almost  ` 12  lakh  crore  this  year.   The  number of returns filed have also increased from 3.79 crore to 6.85 crore  showing  80% growth  in  tax  base.  I  thank  the  honest  taxpayers  of  India  for reposing faith in our Government. Let me assure them that we have  used  their contribution to serve the poor and create better infrastructure.
  2. The Income Tax Department now functions online. Returns, assessments, refunds and queries are all undertaken online. Last  year,  54% of the income-tax returns were accepted as they were filed. Our Government has now approved a  path  breaking,  technology  intensive project to transform the Income-tax Department into a more assessee-  friendly one. All returns  will  be  processed  in  twenty-four  hours  and  refunds issued simultaneously. Within the next two years, almost all verification and assessment of returns selected for scrutiny will be done electronically through anonymised back office, manned by tax experts and officials, without any personal interface between taxpayers and tax officers.
  3. Reducing the tax burden on middle class  has  always  been  our priority ever since our Government took over  in    We  increased the basic exemption limit from ` 2 lakh to ` 2.5  Lakh  and  gave  tax  rebate  so that no tax was  payable  by  persons  having  income  up  to  ` 3  lakh.  We  also reduced the tax rate from 10% to 5% for the tax slab of `2.5 lakh to 5 lakh and introduced Standard Deduction of ` 40,000  for  the  salaried  class. Deduction of savings under section 80C was increased from ` 1 lakh to ` 1.5 lakh. Deduction  of  interest  for  self-occupied  house  property was raised from `1.5 lakh to `2 lakh.
  1. Special benefits and incentives were also given to small  businesses and start-ups.  Overall  compliance  processes  were    Threshold limit for presumptive taxation of business was raised from 1 crore to ` 2 crore. The  benefit  of  presumptive  taxation  was  extended for the first time to  small  professionals  fixing  threshold  limit  at  `50  lakh. In order to promote a less cash economy, the presumptive profit rate  has been reduced from 8% to 6%. The tax rate for companies with turnover of up to `250 crore, covering  almost  99%  of  the  companies,  was  reduced to 25% which was  also  applicable  to  new  manufacturing  companies  without any turnover limits.

GST Reform for benefit to consumers and businesses

  1. The Goods and Services Tax (GST) reforms lingered on during the previous Government for almost a decade. Our  Government  implemented the GST, which is undoubtedly  the  biggest  taxation  reform  undertaken  since Independence. Seventeen different taxes levied by the Central and State/UT Governments with cascading effect of  tax  on  tax,  were consolidated into one GST. India became a  common    GST  has resulted in increased tax base, higher  collections  and  ease  of  trade.  This  will reduce the interface between the tax payer and the Government for day-to-day operations and assessments. Now returns are fully online and e-way bill system is in place. Inter-state movements have become  faster,  more efficient, and hassle free with no Entry Tax, check posts, and truck queues.
  2. The high taxation levied on multiple commodities in the pre-GST regime has been rationalised and the burden  on  the  consumer,  especially the poor and the middle class, has been significantly reduced. The GST  Council, comprising the Centre and States/UTs, finalised the GST rates collectively mostly lower than pre-GST rates. Since then, GST has been continuously reduced providing relief of about ` 80,000 crore annually to consumers. Most items of  daily  use  of the  poor and  middle  class  are  now in the 0% or 5% tax slab. Cinema goers  who  were  subjected  to  multiple taxes up to 50% are mostly paying much lower tax at 12% now. Our Government wants the GST burden on home buyers to be reduced and accordingly we have moved the GST Council  to  appoint  a  Group  of  Ministers to examine and make recommendations in this regard at the earliest.
  3. GST aims to benefit small traders, manufacturers and service Exemptions from GST for  small  businesses  has  been  doubled  from `20 lakh  to  `40 lakh.  Further,  small  businesses  having  turnover  up  to ` 1.5 crore have been given an attractive composition  scheme  wherein they pay only 1% flat rate and  have  to  file  one  annual  return  only.  Similarly, small service providers with turnover upto `50 lakhs can now  opt  for composition scheme and pay GST at 6% instead of 18%.  More  than 35  lakh small traders, manufacturers and service providers will benefit  from  these trader friendly measures. Soon, businesses comprising  over  90%  of  GST payers will be allowed to file quarterly return.
  4. In spite of such major rate reductions  and  relaxations,  revenue  trends are encouraging. The average monthly tax collection in  the  current year is ` 97,100 crore per  month  as  compared  to  ` 89,700  crore  per  month in  the  first    The  State  revenues  are  improving  with guaranteed 14% annual revenue increase for the first five years.

Customs and Trading Across Border Reforms

  1. To promote the “Make in India” initiative, we have undertaken rationalization of customs duties and procedures. Our Government has abolished duties on 36 capital goods. A revised system of importing duty- free capital goods and inputs for manufacture and export has been  introduced, along with introduction of  single  point  of  approval  under section 65 of the Customs Act. Indian Customs is introducing full and comprehensive digitalization of export/import transactions and leveraging RFID technology to improve export logistics.

Demonetisation and Drive against Black Money

  1. Our Government is committed  to  eliminating  the  ills  of  black  money from our country. The anti-black  money  measures  taken  by  us  during the last four and half years in the form of Black Money Law,  the Fugitive Criminal Offenders Act, and Demonetisation, have brought undisclosed income of about ` 1,30,000 crore to tax, led to seizure and attachment of assets worth approximately ` 50,000 crore, and compelled holders of large cash currency to disclose their  source  of    During this period, Benami assets worth ` 6,900 crore and foreign assets worth 1,600 crore have been attached. As  many  as  3,38,000  shell  companies  have been detected and de-registered, and their directors  disqualified. Growth of 18%  in  direct  tax  collection  in  2017-18  and  increase  in  tax  base by as many  as  1.06  crore  people  filing  income  tax  returns  for  the first time in FY 2017-18 is mainly on account of demonetization.

Vision for the next Decade

  1. Madam Speaker, the NDA Government headed by Hon’ble Prime Minister Shri Narendra Modi has  laid  the  foundation  for  India’s  growth  and development for times to come. We have  resolved  many  problems  which were coming in the way of  realising  our  full  potential  as  a  society and an economy.  We  are  poised to become  a  Five  Trillion Dollar Economy  in the next five years  and  aspire  to become  a  Ten Trillion  Dollar  Economy  in the next 8 years thereafter.
  2. In the Indian ethos, anything which is good is supposed to bestow, cause, create and do good in all ten directions. I will, therefore, layout our vision for ten most important dimensions in 2030.
  3. The First Dimension of this  Vision  will  be  to  build  physical  as  well as social infrastructure for a ten  Trillion  Dollar  economy  and  to  provide  ease of living. It will comprise next generation infrastructure of roads,  railways, seaports, airports, urban transport, gas and  electric  transmission  and inland waterways. On the social infrastructure side, every  family  will  have a roof on its head and will live in a healthy, clean and wholesome environment. We will also build a quality, science oriented educational system with Institutes of Excellence providing leadership at the
  4. The Second dimension of our Vision is to create a Digital India  reaching every sector of the economy, every corner of the country and impacting the life of all    Digital  Infrastructure  and  digital  economy of 2030 will be built upon the successes achieved in recent years  in  digitisation of Government processes and private  transactions.  Our  youth  will lead us in this endeavour with innumerable start-ups creating  digital  India, and millions of jobs in this eco-system.
  5. Making India a pollution free nation with green Mother Earth and blue skies is the Third Dimension of our Vision. This India  will  drive  on  Electric Vehicles with Renewables becoming a major  source  of  energy  India will  lead  the  world  in  the  transport  revolution  through electric vehicles and energy storage devices, bringing down import- dependence and ensuring energy security for our people.
  6. Expanding rural industrialisation  using  modern  digital  technologies to generate massive employment is  the  Fourth  Dimension  of  our  This will be built upon the Make in India approach to develop grass-roots level  clusters,  structures  and  mechanisms  encompassing  the  MSMEs, village industries and start-ups spread in every nook and corner of  the country. India is  now  on the way  to becoming  a global manufacturing  hub  in various sectors including automobiles and electronics,  defence  and  medical devices.
  7. Our rivers and water bodies are our life supporting assets. Our Government has worked vigorously for cleaning  River    Fifth Dimension of our Vision for  India  of  2030  is  Clean  Rivers,  with  safe  drinking water to  all  Indians,  sustaining  and  nourishing  life  and  efficient use of water in irrigation using micro-irrigation techniques.
  8. India’s long coastline has  the  potential  of  becoming  the  strength  of the economy, particularly through exploitation of the Blue Economy, to ensure better standards and quality of life for a large  number  of  people  living in the coastal areas. Our efforts in the Sagarmala programme will be scaled up and  we  will  develop  other  inland  waterways    Our  coastline and our ocean  waters  powering  India’s  development  and  growth is the Sixth Dimension of our Vision.
  9. The Seventh Dimension of our Vision aims at the outer skies. Our  space programme  –  Gaganyaan,  India  becoming  the  launch-pad  of satellites for the World  and  placing  an  Indian  astronaut  into  space  by  2022 reflect this dimension of our visions.
  10. Making India self-sufficient in food, exporting to the world to meet their food needs and producing  food  in  the  most  organic  way  is  the  Eighth Dimension of our Vision. High farm production and  productivity will    be achieved through modern agricultural practices and value addition. An integrated approach towards agro and food processing, preservation, packaging and maintenance of the  cold  chain  will  be  our  focus  of attention.
  11. A healthy India is the Ninth Dimension of our Vision. We will  be  aiming at healthy society with an environment of health assurance and the support of necessary health infrastructure. Our Government has  rolled out  the Ayushman Bharat scheme. By 2030, we  will  work  towards  a  distress  free health care and a  functional  and  comprehensive  wellness  system  for all. Such a healthy India built with the participation of women having equal rights and concern for their safety and empowerment.
  12. Our Vision can be  delivered  by  Team  India  –  our  employees  working together with the elected Government, transforming India into a Minimum Government Maximum Governance nation. This is the Tenth Dimension. Our India of 2030 will have a proactive and responsible bureaucracy which will be viewed as friendly to people.
  13. With this comprehensive ten-dimensional Vision, we will create an India where poverty,  malnutrition,  littering  and  illiteracy  would  be  a matter of the past. India would be a modern,  technology  driven,  high  growth, equitable and transparent

The Fiscal Programme for 2019-20 and beyond

  1. The estimate of incomes and expenditure which I am presenting  today, pegs the fiscal deficit of year 2019-20 at  4%  of  GDP.  We  would  have maintained fiscal deficit at 3.3% for year 2018-19 and taken further steps to consolidate fiscal deficit in year 2019-20. However, considering the need for income support to farmers we have provided `20,000 crore in 2018-19 RE and 75,000 crore in 2019-20 BE. If we exclude this, the fiscal deficit would have been less than 3.3% for 2018-19 and less than 3.1% for year 2019-20.
  2. Total expenditure   rises   from   ` 24,57,235  crore   in  2018-19   RE  to 27,84,200 crore in  2019-20  BE,  a  rise  of  `3,26,965  crore  or  approximately 13.30%. This reflect a high increase considering low inflation. Capital Expenditure for 2019-20 BE is estimated to be ` 3,36,292 crore. Centrally Sponsored Schemes (CSS) are proposed to be allocated `3,27,679 crore in BE 2019-20 as  against  ` 3,04,849  crore  in  2018-19  RE.  Allocation for National Education  Mission  is  being  increased  from  ` 32,334  crore  in RE 2018-19 to  ` 38,572  crore  in  BE  2019-20.  Allocation  for  Integrated  Child Development Scheme (ICDS)  is  being  increased  from  ` 23,357  crore  in RE 2018-19 to `27,584 crore in BE 2019-20.
  1. A substantial increase is proposed in the  allocation  for  welfare  of  the Scheduled Castes and Scheduled Tribes. The allocation of `56,619 crore made in BE of 2018-19 for Scheduled Caste, further increased to ` 62,474  crore in RE is proposed to be  enhanced  to  `76,801 crore  in  BE  for  2019- 20, an increase of 35.6% over  BE  of  2018-19.  For  the  Scheduled  Tribes  also, proposed allocation in 2019-20 BE is ` 50,086 crore as against 39,135 crore in BE 2018-19, an increase of 28%.
  1. We have pursued the public enterprises  asset  management  agenda to make these  enterprises  accountable  to  the    As  many  as  57 CPSEs are now listed with total  market  capitalisation  of  over  ` 13  lakh crore. The Government received over ` 1 lakh crore from disinvestment proceeds during 2017-18. We are confident of crossing the target of 80,000 crore this year.
  1. We have maintained the glide path towards our  target  of  3%  of  fiscal deficit to be achieved by 2020-21.  India’s  Debt  to  GDP  ratio  was  5% in year 2017-18. The  FRBM  Act  prescribes  that  the  Debt  to  GDP ratio of the Government of India should be brought down  to  40%  by  2024-25. Along with completion of the fiscal  deficit  consolidation  programme, we will now focus on Debt consolidation.
  2. Our Government had promised last year that we will  carry  out reforms in stamp duty levied and collected on financial  securities  I am proposing, through the Finance  Bill,  necessary  amendments in this regard. The amendments proposed would  usher  in  a very streamlined system. Stamp duties would be levied on one instrument relating to one transaction and get  collected  at  one  place  through  the  Stock Exchanges. The duty so collected will be shared with the State Governments seamlessly on the basis of domicile of buying client.


Tax Proposals

  1. On behalf of all the people of India and our Government, I would first like to thank all our taxpayers for their valuable contribution to nation building and for providing a better life to the poor and marginalized sections of society. Your tax helps provide dignity to our sisters and mothers with toilets and cooking gas connections. Your tax pays for the electricity connections to the poor who lived in darkness for generations. The tax you pay will provide health care to 50 crore brothers and sisters, and children. It is you who is ensuring respect, dignity, and a secure future to our retired jawans through One Rank One Pension. Thank you,
  2. Because of major tax reforms undertaken by us during the last four and half years, both tax collections as well as the tax base have shown significant increase and we have made progress towards achieving a moderate taxation– high compliance regime. It is, therefore, just and fair that some benefits from the tax reforms must also be passed on to the middle class taxpayers. Keeping this in view, I propose to further reduce the tax burden on such taxpayers. Though as per convention, the main tax proposals will be presented in the regular budget, small taxpayers especially middle class, salary earners, pensioners, and senior citizens need certainty in their minds at the beginning of the year about their taxes. Therefore, proposals, particularly relating to such class of persons should not wait. Hence, while for the present the existing rates of income tax will continue for FY 2019-20, I propose the following:
  3. Individual taxpayers having taxable annual income up to ` 5 lakhs will get full tax rebate and therefore will not be required to pay any income tax. As a result, even persons having gross income up to ` 50 lakhs may not be required to pay any income tax if they make investments in provident funds, specified savings, insurance etc. In fact, with additional deductions such as interest on home loan up to ` 2 lakh, interest on education loans, National Pension Scheme contributions, medical insurance, medical expenditure on senior citizens etc, persons having even higher income will not have to pay any tax. This will provide tax benefit of ` 18,500 crore to an estimated 3 crore middle class taxpayers comprising self employed, small business, small traders, salary earners, pensioners and senior citizens.
  4. For salaried persons, Standard Deduction is being raised from the current ` 40,000 to ` 50,000. This will provide additional tax benefit of 4,700 crore to more than 3 crore salary earners and pensioners.
  1. Currently, income tax on notional rent is payable if one has more than one self-occupied house. Considering the difficulty of the middle class having to maintain families at two locations on account of their job, children’s education, care of parents etc. I am proposing to exempt levy of income tax on notional rent on a second self-occupied houses.
  2. TDS threshold on interest earned on bank/post office deposits is being raised from ` 10,000 to ` 40,000. This will benefit small depositors and non- working spouses. Further, the TDS threshold for deduction of tax on rent is proposed to be increased from ` 1,80,000 to ` 2,40,000 for providing relief to small taxpayers.
  3. The benefit of rollover of capital gains under section 54 of the Income Tax Act will be increased from investment in one residential house to two residential houses for a tax payer having capital gains up to ` 2 crore. This benefit can be availed once in a life time.
  4. For making more homes available under affordable housing, the benefits under Section 80-IBA of the Income Tax Act is being extended for one more year, i.e. to the housing projects approved till 31st March,
  5. Also, for giving impetus to the real estate sector, I have proposed to extend the period of exemption from levy of tax on notional rent, on unsold inventories, from one year to two years, from the end of the year in which the project is

Concluding Remarks

  1. Madam Speaker, This is not merely an Interim Budget, but a medium of the country’s development journey. All the transformation that we are witnessing, is because of the passion of the people of our nation. The credit goes to them only. Development has become a mass-movement during the period of our Government.
  2. We will transform India into a leading nation of the world with the help of our people. We, along with them have laid the foundation. A grand edifice will be erected with their support. We have given a decisive leadership, whose intent is clear, policy is transparent and integrity is resolute.
  3. With this, I commend the Budget to this august



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