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Friday, 02 Feb 2018
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Union Budget: 2018-19
Grand schemes, but execution is the key

The Union Budget for 2018-19, presented by Finance Minister Arun Jaitley, has scores of grand plans which will certainly help targeted groups and nudge the economy towards higher growth path. However, the big question is: Will small leakages and delays hamper their implementation? 
 
The 20.8 percent increase in the capital outlay for various infrastructure projects, launch of National Health Insurance scheme, MSP to farmers at 1.5 percent of the cost of production and housing for all are expected not only to generate more jobs, but also increase rural demand for consumer goods which in turn will help the Indian corporate world, waiting for revival in domestic demand.
 

Infrastructure and Financial Sector Development

Continuing the emphasis on setting up modern infrastructure, this year’s budget indicates an overall increase of 20.8 percent in the total capital outlay. The government’s estimated budgetary and extra budgetary expenditure on infrastructure for 2018-19 has been increased to Rs 5.97 lakh crore against estimated expenditure of Rs 4.94 lakh crore in 2017-18.

To take care of the growing needs of urban India, the government has rolled out two programmes – Smart Cities Mission and AMRUT. 
 

Railways and Highways

The Union Ministry of Road Transport and Highways is confident of commissioning National Highways of over 9,000 km by March 2018. The Bharatmala Pariyojana has been set on roll for providing seamless connectivity of interior and backward areas and borders of the country to develop about 35,000 km in Phase-I at an estimated cost of Rs 5,35,000 crore.

The Railways’ capex for the year 2018-19 has been pegged at Rs 1,48,528 crore.  The project plans of 18,000 km of doubling, third and fourth line works and 5,000 km of gauge conversion is expected to convert almost the entire network into Broad gauge. During 2017-18 around 4,000 km of electrification of railway network is targeted for commissioning.  

In Mumbai, the rail transport system is being expanded and augmented by adding 90 km of double line tracks at a cost of over Rs 11,000 crore. Additionally, 150 km of additional suburban network is being planned at a cost of over Rs 40,000 crore. In Bengaluru, a suburban network of 160 km at an estimated cost of Rs 17,000 crore is being planned. 
 

House for All

Under Prime Minister Awas Scheme Rural, 51 lakh houses have been constructed in 2017-18 and 51 lakh houses will be set up during 2018-19. In urban India the government intends to construct 37 lakh houses.
 

Health: Steps towards Universal Health Coverage

Two major initiatives have been proposed under the Ayushman Bharat programme, aiming at making path-breaking interventions to address health holistically, in primary, secondary and tertiary care system, covering both prevention and health promotion. 
 
The National Health Policy 2017 envisions Health and Wellness Centres as the foundation of India’s health system. These 1.5 lakh centres will bring health care system closer to the homes of people. These centres will provide comprehensive health care, including for non-communicable diseases and maternal and child health services. The Government on its part would commit Rs 1,200 crore this year and has invited contributions from the private sector through CSR and philanthropic institutions in adopting these centres.

The government will launch a flagship National Health Protection Scheme to cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries), providing coverage up to Rs 5 lakh rupees per family per year for secondary and tertiary care hospitalization.
 
The Central government intends to set up 24 new Government Medical Colleges and Hospitals by upgrading existing district hospitals in the country.
 

MSMEs

In addition to cutting the corporate tax rate from 30 percent to 25 percent to all companies with an annual turnover up to Rs 250 crore, the budget has provided Rs 3,794 crore to the MSMEs sector for giving credit support, capital and interest subsidy and innovations.
 

Fiscal Deficit

Total Revised Estimates for expenditure in 2017-18 is Rs 21.57 lakh crore (net of GST compensation transfers to the states) as against the Budget Estimates of Rs 21.47 lakh crore. As a result, the revised fiscal deficit estimates for 2017-18 is Rs 5.95 lakh crore which works out to 3.5 percent of GDP. This is higher than the earlier target of 3.2 percent set for the fiscal. The Finance Minister has projected a fiscal deficit of 3.3 percent of GDP for 2018-19.
 
 
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