India Budget 2020-2021 All Budget Analysis of Union Budget - Blog

🔺India Budget 2020-2021🔻

Prominent Themes of the Budget

Aspirational india

I shall cover programmes and plans related to: (1) Agriculture Irrigation and Rural development (2) Wellness, Water and Sanitation and (3) Education and Skills

Agriculture, Irrigation and Rural Development

Our government is committed to the goal of doubling farmers’ incomes by 2022. We have provided energy sovereignty through KUSUM and input sovereignty through Paramparagat Krishi Vikas Yojana. We have provided resilience for 6.11 crores farmers insured under PM Fasal Bima Yojana. Focus on cultivation of pulses, expansion of micro-irrigation through Krishi Sinchai Yojana, have raised the self-reliance of the country. Provision of any annual supplement of the income to the farmer, directly is done through PM-KISAN. Connectivity through PMGSY, financial inclusion have helped raise farm incomes.

      Prosperity to farmers can be ensured by making farming competitive. For this, farm markets need to be liberalised. Distortions in farm and livestock markets need to be removed. Purchase of farm produce, logistics and agri-services need copious investments. Substantial support and hand-holding of farm-based activities such as livestock, apiary, and fisheries need to be provided for. Farmers desire integrated solutions covering storage, financing, processing and marketing.

      Adopting sustainable cropping patterns and bringing in more technology are integral to our plan. All this and more can be achieved through working with and in cooperation with the States.

     We propose to encourage those State governments who undertake implementation of following model laws already issued by the Central government:

a) Model Agricultural Land Leasing Act, 2016
b) Model Agricultural Produce and Livestock Marketing (Promotion and Facilitation) Act, 2017;, and
c) Model Agricultural Produce and Livestock Contract Farming and Services (Promotion and                  Facilitation) Act, 2018

     Water stress related issues are now a serious concern across the country. Our government is proposing comprehensive measures for one hundred water stressed districts.

     In the Budget speech of July 2019, I had stated that “annadata” can be “urjadata” too. The PM-KUSUM scheme removed farmers’ dependence on diesel and kerosene and linked pump sets to solar energy. Now, I propose to expand the scheme to provide 20 lakh farmers for setting up stand-alone solar pumps; further we shall also help another 15 lakh farmers solarise their grid-connected pump sets. In addition, a scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid would be operationalized.

     Our government shall encourage balanced use of all kinds of fertilizers including the traditional organic and other innovative fertilizers. This is a necessary step to change the prevailing incentive regime, which encourages excessive use of chemical fertilisers. 

     India has an estimated capacity of 162 million MT of agriwarehousing, cold storage, reefer van facilities etc. NABARD will undertake an exercise to map and geo-tag them. In addition, we propose creating warehousing, in line with Warehouse Development and Regulatory Authority (WDRA) norms. Our government will provide Viability Gap Funding for setting up such efficient warehouses at the block/taluk level. This can be achieved, where States can facilitate with land and are on a PPP mode. Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) shall undertake such warehouse building on their land too.


 As a backward linkage, a Village Storage scheme is proposed to be run by the SHGs. This will provide farmers a good holding capacity and reduce their logistics cost. Women, SHGs shall regain their position as “Dhaanya Lakshmi”.

 To build a seamless national cold supply chain for perishables, inclusive of milk, meat and fish, the Indian Railways will set up a “Kisan Rail” – through PPP arrangements. There shall be refrigerated coaches in Express and Freight trains as well. 

Krishi Udaan will be launched by the Ministry of Civil Aviation on international and national routes. This will immensely help improve value realisation especially in North-East and tribal districts.

Horticulture sector with its current produce of 311million MT exceeds production of food grains. For better marketing and export, we propose supporting States which, adopting a cluster basis, will focus on “one product one district”. 

Integrated farming systems in rainfed areas shall be expanded. Multi-tier cropping, bee-keeping, solar pumps, solar energy production in non-cropping season will be added. Zero-Budget Natural Farming (mentioned in July 2019 budget) shall also be included. The portal on “jaivik kheti” – online national organic products market will also be strengthened. 

Financing on Negotiable Warehousing Receipts (e-NWR) has crossed more than`6000 crore. This will be integrated with e-NAM.

 Non-Banking Finance Companies (NBFCs)and cooperatives are active in the agriculture credit space. The NABARD re-finance scheme will be further expanded. Agriculture credit target for the year 2020-21 has been set at ` 15 lakh crore. All eligible beneficiaries of PM-KISAN will be covered under the KCC scheme.

Our government intends to eliminate Foot and Mouth disease, brucellosis in cattle and also peste des petits ruminants (PPR) in sheep and goat by 2025. Coverage of artificial insemination shall be increased from the present 30% to 70%. MNREGS would be dovetailed to develop fodder farms. Further, we shall facilitate doubling of milk processing capacity from 53.5 million MT to 108 million MT by 2025.

 Blue Economy: Our government proposes to put in place a framework for development, management and conservation of marine fishery resources.

Youth in coastal areas benefit through fish processing and marketing. By 2022-23, I propose raising fish production to 200 lakh tonnes. Growing of algae, sea-weed and cage Culture will also be promoted.

Our government will involve youth in fishery extension through 3477 Sagar Mitras and 500 Fish Farmer Producer Organisations. We hope to raise fishery exports to ` 1 lakh crore by 2024-25.

Under Deen Dayal Antyodaya Yojana for alleviation of poverty, 58 lakh SHGs have been mobilised. We shall further expand on SHGs.

Now, for the fund allocation for the 16 different steps mentioned above, they are being stated under two different categories:

For the sector comprising of Agriculture and allied activities, Irrigation and Rural Development an allocation of about ` 2.83 lakh crore has been made for the year 2020-21 . Its divided, inter-alia;


a) For Agriculture, Irrigation & allied activities - ` 1.60 lakh crore 

b) For Rural development & Panchayati Raj - ` 1.23 lakh crore  



Wellness,Water and Sanitation

Under Aspirational India, I shall now speak about Wellness, Water and Sanitation.

We have a holistic vision of healthcare that translates into wellness of the citizen. Mission Indradhanush has been expanded to cover 12 such diseases, including five new vaccines. FIT India movement is a vital part of fight against Non communicable diseases coming out of life style issues . A very focused safe water (Jal Jeevan Mission) and comprehensive sanitation program (Swachch Bharat Mission) have been launched to support the health vision. That would reduce the disease burden on the poor.

 Presently, under PM Jan Arogya Yojana (PMJAY) ,there are more than 20,000 empanelled hospitals. We need more in Tier-2 and Tier-3 cities for poorer people under this scheme.

. It is proposed to set up Viability Gap funding window for setting up hospitals in the PPP mode. In the first phase, those Aspirational Districts will be covered, where presently there are no Ayushman empanelled hospitals. This would also provide large scale employment opportunities to youth. Proceeds from taxes on medical devices would be used to support this vital health infrastructure

Using machine learning and AI, in the Ayushman Bharat scheme, health authorities and the medical fraternity can target disease with an appropriately designed Preventive regime.

“TB Harega Desh Jeetega” campaign has been launched. I propose to strengthen these efforts realise our commitment to end Tuberculosis by 2025.

I propose to expand Jan Aushadhi Kendra Scheme to all districts offering 2000 medicines and 300 surgicals by 2024.

I have provided for the health sector about `69,000 crores that is inclusive of ` 6400 crores for Prime Minister Jan Arogya Yojana (PMJAY)

Our government is committed to ODF Plus in order to sustain ODF behaviour and to ensure that no one is left behind. Now, more needs to be done towards liquid and grey water management. Focus would also be on Solid waste collection, source segregation and processing.

Total allocation for Swachh Bharat Mission is about `12,300 crore in 2020-21.

Aiming to provide piped water supply to all households, Prime Minister announced from the Red Fort the Jal Jeevan Mission. Our government has approved `3.60 lakh crore for this Mission. This scheme also places emphasis on augmenting local water sources, recharging existing sources and will promote water harvesting and de-salination. Cities with over a million population will be encouraged to meeting this objective during the current year itself.

During the year 2020-21 the scheme would be provided budget of ` 11,500 crore.


Education and Skills

The third and the final item under Aspirational India is Education and Skills.

• By 2030, India is set to have the largest working-age population in the world. Not only do they need literacy but they need both job and life skills. Dialogues have been held with State Education Ministries, Members of Parliament and other stake-holders about Education policy. Over 2 lakh suggestions were also received. The New Education Policy will be announced soon.

• It is felt that our education system needs greater inflow of finance to attract talented teachers, innovate and build better labs. Therefore steps would be taken to enable sourcing External Commercial Borrowings and FDI so as to able to deliver higher quality education.

• Students in the general stream (vis-à-vis services or technology stream) need their employability improved. About 150 higher educational institutions will start apprenticeship embedded degree/diploma courses by March 2021.

• The government proposes to start a programme whereby urban local bodies across the country would provide internship opportunities to fresh engineers for a period up to one year. 

• In order to provide quality education to students of deprived section of the society as well as those who do not have access to higher education, it is proposed to start degree level full-fledged online education programme. This shall be offered only by institutions who are ranked within top 100 in the National Institutional Ranking framework. Initially, only a few such institutions would be asked to offer such programmes. 

• India should be a preferred destination for higher education. Hence, under its “Study in India” programme, Ind-SAT is proposed to be held in Asian and African countries. It shall be used for benchmarking foreign candidates who receive scholarships for studying in Indian higher education centres.

• A National Police University and a National Forensic Science University are being proposed in the domain of policing science, forensic science, cyber-forensics etc.

• There is a shortage of qualified medical doctors, both general practitioners as well as specialists. In order to meet this requirement;

• It is proposed to attach a medical college to an existing district hospital in PPP mode. Those states that fully allow the facilities of the hospital to the medical college and wish to provide land at a concession, would be able to receive Viability Gap Funding. Details of the scheme would be worked out.

• National Board of Examination imparts PG medical qualifications ; Diploma and fellow of National Board (DNB/FNB). The Government will, therefore encourage large hospitals with sufficient capacity to offer resident doctors DNB/FNB courses under the National Board of Examinations.

• There exists a huge demand for teachers, nurses, para-medical staff and care-givers abroad. However, their skill sets, many a time, do not match the employer’s standards and therefore need to be improved. I propose that special bridge courses be designed by the Ministries of Health, Skill Development together with professional bodies to bring in equivalence. Language requirements of various countries need also to be included. All these should be achieved through special training packages. 

• Our Government proposes to provide about ` 99,300 crore for education sector in 2020-21 and about ` 3,000 crores for skill development.     

Economic Development

Industry, Commerce and Investment

The guilds of Saraswati-Sindhu civilization & the Harappan seals are remarkable. They belong to 3300 BCE. Words from the Indus Scripthieroglyphs have been deciphered. Commerce and trade related words show how India for a millennia is continuing as rich in skills, metallurgy, trade etc. “Takara Kolimi=Tin smithery”, “ Sreni “= Guild ,” Sethi”= wholesale merchant, “Poddar”= Assayer of metal into treasury.

Entrepreneurship has always been the strength of India. Even today, young men and women have given up greener pastures elsewhere to contribute to India’s growth. They are risk-taking and come up with disruptive solutions to festering challenges. Equally, established old industries are resetting themselves in a changing global and domestic situation. We recognise the knowledge, skills and risk-taking capabilities of our youth. He is no longer the job seeker. He is creator of jobs. Now we wish to create more opportunities and remove road-blocks from his path.

I propose to set up an Investment Clearance Cell that will provide “end to end” facilitation and support, including pre-investment advisory, information related to land banks and facilitate clearances at Centre and State level. It will work through a portal.

There is a case for maximising the benefits of three separately developing economic activities: (1) the upcoming economic corridors; (2) revitalisation of manufacturing activities; and (3) Technology and the demands of aspirational classes. We have to benefit from their convergence. Hence, it is proposed to develop five new smart cities in collaboration with States in PPP mode. Such sites would be chosen that offer the best choices in terms of aforementioned principles.

India needs to manufacture Networked products. That will make it a part of global value chains. This in turn gets more investment and generates more employment for our youth.

Electronics manufacturing industry is very competitive and India has shown its cost advantages. The potential of this industry in job creation is immense. India needs to boost domestic manufacturing and attract large investments in the electronics value chain. Here, I propose a scheme focussed on encouraging manufacture of mobile phones, electronic equipment and semi-conductor packaging. Details would be announced later.

With suitable modifications, this scheme can be adapted for manufacture of medical devices too

India imports significant quantity of technical textiles worth US$ 16 billion every year. To reverse this trend and to position India as a globa leader in Technical Textiles, a National Technical Textiles Mission is proposed with a four-year implementation period from 2020-21 to 2023-24 at an estimated outlay of ` 1480 crore.

From the Red Fort, our Prime Minister spoke about quality and standards when he spoke of “Zero Defect-Zero Effect” manufacturing. In September last year, I had called for a time-bound adoption by industry of all necessary, mandatory technical standards and their effective enforcement. All Ministries, during the course of this year, would be issuing quality standard orders.

To achieve higher export credit disbursement, a new scheme, NIRVIK is being launched, which provides for higher insurance coverage, reduction in premium for small exporters and simplified procedure for claim settlements.

It is proposed to digitally refund to exporters, duties and taxes levied at the Central, State and local levels, such as electricity duties and VAT on fuel used for transportation, which are not getting exempted or refunded under any other existing mechanism. This Scheme for Reversion of duties and taxes on exported products will be launched this year.

It is the vision of the Prime Minister that each District should develop as an export hub. Efforts of the Centre and State governments are being synergised and institutional mechanisms are being created.

Government e-Marketplace (GeM) is moving ahead for creating a Unified Procurement System in the country for providing a single platform for procurement of goods, services and works. It offers a great opportunity for Medium, Small and micro Enterprises(MSMEs). 3.24 lakh vendors are already on this platform. Its proposed to take its turnover to ` 3lakh crores.

I propose to provide about ` 27,300 crore for development and promotion of Industry and Commerce for the year 2020-21.


Infrastructure 

Hon’ble Speaker, Sir, in his Independence Day speech 2019, Prime Minister had highlighted that ` 100 lakh crore would be invested on infrastructure over the next 5 years. As a follow up measure, I had launched the National Infrastructure Pipeline on 31st December 2019 of ` 103 lakh crore. It consists of more than 6500 projects across sectors and are classified as per their size and stage of development.

These new projects will include housing, safe drinking water, access to clean and affordable energy, healthcare for all, world-class educational institutes, modern railway stations, airports, bus terminals, metro and railway transportation, logistics and warehousing, irrigation projects, etc. The National Infrastructure Pipeline envisions improving the ease of living for each individual citizen in the country. It’s also will bring in generic and sectoral reforms in development, operation and maintenance of these infrastructure projects.

A huge employment opportunity exists for India’s youth in construction, operation and maintenance of infrastructure. National Skill Development Agency will give special thrust to infrastructure-focused skill development opportunities.

I propose to set up a project preparation facility for infrastructure projects. This programme would actively involve young engineers, management graduates and economists from our Universities.

It is also proposed to direct all infrastructure agencies of the government to involve youth-power in start-ups. They will help in rolling out value added services in quality public infrastructure for citizens.

A National Logistics Policy will be released soon. Inter alia; it will clarify the roles of the Union Government, State Governments and key regulators. It will create a single window e-logistics market and focus on generation of employment, skills and making MSMEs competitive.

Accelerated development of highways will be undertaken. This will include development of 2500 Km access control highways, 9000 Km of economic corridors, 2000 Km of coastal and land port roads and 2000 Km of strategic highways.

Delhi-Mumbai Expressway and two other packages would be completed by 2023 . Chennai-Bengaluru Expressway would also be started.

FASTag mechanism encourages us towards greater commercialisation of our highways so that NHAI can raise more resources. I propose to monetise at least twelve lots of highway bundles of over 6000 Km before 2024

In carrying out its duty, the Indian Railways performs a service to the nation.


a) Within 100 days of assumption of this government, it has commissioned 550 wi-fi facilities in as many stations.

b) Eliminated unmanned crossings

c) Aims to achieve electrification of 27000 Km of tracks.

This will call for optimisation of costs. Railways has small operating surplus. About Indian Railways, there are five measures, among others, that I wish to highlight:

• Setting up a large solar power capacity alongside the rail tracks, on the land owned by the railways. A proposal is under consideration.

• Four station re-development projects and operation of 150 passenger trains would be done through PPP mode. The process of inviting private participation is underway. 

• More Tejas type trains will connect iconic tourist destinations.

• High speed train between Mumbai to Ahmedabad would be actively pursued. 

• 148 km long Bengaluru Suburban transport project at a cost of ` 18600 crore, would have fares on metro model. Central Government would provide 20% of equity and facilitate external assistance up to 60% of the project cost.  

Our sea-ports need to be more efficient. Technology has to used to improve performance. A governance framework keeping with global benchmarks needs to be put in place.

This government would consider corporatizing at least one major port and subsequently its listing on the stock exchanges.

Inland Waterways received a boost in the last five years. The Jal Vikas Marg on National Waterway-1 will be completed. Further, the 890 Km Dhubri-Sadiya connectivity will be done by 2022.

Developing waterways has its impact on the eco-system on both the banks of the river. Our Prime Minister has conceptualised “Arth Ganga”. Plans are afoot to energise economic activity along river banks. 

Air traffic has been growing rapidly in the country as compared to global average. One hundred more airports would be developed by 2024 to support Udaan scheme. It is expected that the air fleet number shall go up from the present 600 to 1200 during this time.

I propose to provide about ` 1.70 lakh crore for transport Infrastructure in 2020-21.

Taking electricity to every household has been a major achievement. However, the distribution sector, particularly the DISCOMS are under financial stress. The Ministry intends to promote “smart” metering. I urge all the States and Union Territories to replace conventional energy meters by prepaid smart meters in the next 3 years. Also, this would give consumers the freedom to choose the supplier and rate as per their requirements.

I propose to provide about ` 22,000 crore to power and renewable energy sector in 2020-21

In the upstream sector of oil and gas, the Open Acreage Licensing Policy (OALP) is a success having awarded 1,37,000 sq km for exploration to private sector and to the CPSEs. City gas distribution rights are also awarded.

Further, it is proposed to expand the national gas grid from the present 16200 km to 27000 km, and

To deepen gas markets in India, further reforms will be undertaken to facilitate transparent price discovery and ease of transactions.



New Economy

The new economy is based on innovations that disrupt established business models. Artificial intelligence, Internet-of-Things (IoT), 3D printing, drones, DNA data storage, quantum computing, etc., are re-writing the world economic order. India has already embraced new paradigms such as the sharing economy with aggregator platforms displacing conventional businesses. Government has harnessed new technologies to enable direct benefit transfers and financial inclusion on a scale never imagined before.

It is now a cliché – “data is the new oil” and it is true that Analytics, Fintech and Internet of Things (IOT) are changing the way we deal with our lives. To take advantage of this, I propose:

To bring out soon a policy to enable private sector to build Data Centre parks throughout the country. It will enable our firms to skilfully incorporate data in every step of their value chains.

Our vision is that all “public institutions” at Gram Panchayat level such as Anganwadis, health and wellness centres, government schools, PDS outlets, post offices and police stations will be provided with digital connectivity. So, Fibre to the Home (FTTH) connections through Bharatnet will link 100,000 gram panchayats this year.

It is proposed to provide ` 6000 crore to Bharatnet programme in 2020-21.

We need to expand the base for knowledge-driven enterprises. Intellectual property creation and protection will play an important role. Several measures are proposed in this regard, which will benefit the Startups.

A digital platform would be promoted that would facilitate seamless application and capture of IPRs. Also, in an Institute of Excellence, a Centre would be established that would work on the complexity and innovation in the field of Intellectual Property.

Knowledge Translation Clusters would be set up across different technology sectors including new and emerging areas.

For designing, fabrication and validation of proof of concept, and further scaling up Technology Clusters, harbouring such test beds and small scale manufacturing facilities would be established.

Mapping of India’s genetic landscape is critical for next generation medicine, agriculture and for bio-diversity management. To support this development, we will initiate two new national level Science Schemes, to create a comprehensive database.

The government proposes to provide early life funding, including a seed fund to support ideation and development of early stage Start-ups.

Quantum technology is opening up new frontiers in computing, communications, cyber security with wide-spread applications. It is expected that lots of commercial applications would emerge from theoretical constructs which are developing in this area.

It is proposed to provide an outlay of ` 8000 crore over a period five years for the National Mission on Quantum Technologies and Applications.