Union Budget 2k22 – Part 02

In continuation with where we had left off last time and to revive our memories a bit, let us revisit the four important pillars, based on which the union budget 2k22 was formulated:

• A.  PM Gati-Shakti
• B.  Inclusive Development
• C.  Productivity enhancement and investment; Sunrise opportunities, Energy transition and Climate action
• D.  Financing of investments

Parts A and B were discussed in part 01 and now, let us quickly transition to the parts C and D.

Productivity enhancement and investment; Sunrise opportunities, Energy transition and Climate action:

This segment of the union budget primarily talks about creating ease of living and establishment of good and trusted governance in the entirety of the country.

Under the Vibrant Villages Programme, development of villages alongside India’s borders which have sparse population, limited connectivity and infrastructure has been proposed.              

As far as the aspect of banking is concerned, 100% of 1.5 lakh post offices will be onboarded on the core banking system.

The setting up of 75 Digital Banking Units (DBUs) in 75 different districts by Scheduled Commercial Banks has been proposed.

E-passports with embedded chip and futuristic technology is slated to be rolled out in the near future.

Urban planning:

Town planning Schemes (TPS)and Transit Oriented Development (TOD)will be implemented.

Battery swapping policy to be brought out for setting up charging stations at scale in urban areas.

Unique Land Parcel Identification Number for IT-based management of land records has been proposed.

Accelerated Corporate Exit: Centre for Processing Accelerated Corporate Exit (C-PACE) has been proposed to be established for speedy winding up of companies so that newer establishments can come up at a faster rate.

AVGC Promotion Task Force: An Animation, Visual Effects, Gaming and Comic (AVGC)promotion task force is slated to be established to explore the potential of the gaming and visual effects industry and to bring the same to the forefront.

Atmanirbharata in Defence: 68% of capital procurement budget has been earmarked for domestic industry in 2022-2023 which is an increase from 58% in 2021-22. This primarily means that the defence sector of the country will procure all defence equipment from domestic manufacturers to an extent of 68% in the FY 22-23 compared to 58% of the previous fiscal year. This is bound to impart a much needed boost to the domestic defence equipment manufacturers.

Sunrise opportunities: Government contribution is to be provided for the purpose of research and development in “sunrise opportunities” like Artificial Intelligence, Geospatial Systems and Drones, Semi-conductors and its ecosystem, Space economy, Geonomics and Pharmaceuticals, Green Energy and Clean Mobility Systems. This will aid India in becoming better in terms of employment and investment opportunities.

Energy Transition and Climate Action: An additional allocation of Rs. 19500 crores has been proposed for manufacturing of high efficiency solar modules to under the Production Linked incentive Scheme to meet the goal of 280 GW of installed solar power by 2030.

Four pilot projects have been proposed to be established for coal gasification and conversion of coal into chemicals for the industry.

Besides all these intensive schemes that are meant to reinforce sustainable development in the country, extensive financial support to farmers who are keen to take up agro-forestry has also been proposed in this year’s union budget.

Another pivotal concept that should be mentioned in this context is that RBI has proposed to introduce digital currency. This move is meant to provide a boost to digital economy and will promote a cheaper currency management system.

Picture credit:

https://www.krctimes.com/stories/introduction-of-central-bank-digital-currency-digital-rupee-announced/

Financing of investments:

n  The union budget has proposed the allocation of Rs. 1 lakh crores in 2022-23 to assist all states in fast-tracking investments in the economy.

n  Total expenditure in 2022-23 is estimated to be Rs. 39.45 lakh crores whereas the total receipts other than borrowings is estimated to be Rs. 22.84 lakh crores.

n  Fiscal deficit in the upcoming FY of 22-23 is estimated to be 6.4% of our GDP as compared to the current fiscal deficit of around 6.9%

 With this, we come to the conclusion of this two-part blog series, the sole objective of which was to give our readers a holistic overview of the union budget of 2022.