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Yojana Magazine - March 2020

Date: 23 March 2020

 

 

  • Contents
  1. Introduction
  2. Tax Proposals
  3. Urban Landscape
  4. Transport Infrastructure
  5. Industries
  6. Financial Sector
  7. Water & Sanitation
  8. Universal Health Coverage
  9. Education
  10. Skills, Employment & HRD
  11. Agriculture
  12. Environment & Forest
  13. Gender Budgeting & Elderly
  14. Northeast Development

 Introduction

Tax Proposals

 

 

Others | Direct Tax

  • Dividend Distribution Tax (DDT) removedmaking India a more attractive investment destination
  • Start-ups with turnover up to Rs. 100 crore to enjoy 100% deduction for 3 consecutive assessment years out of 10 years.
    • Tax payment on ESOPs deferred
  • Cooperative societies exempted from Alternate Minimum Tax (AMT) just like Companies are exempted from the Minimum Alternate Tax (MAT).
  • Tax concession for foreign investments:
    • 100% tax exemption to the interest, dividend and capital gains income on investment made in infrastructure and priority sectors before 31stMarch, 2024 with a minimum lock-in period of 3 years by the Sovereign Wealth Fund of foreign governments.

Others | Indirect Tax

  • Excise duty proposed to be raised on Cigarettes and other tobacco products, no change made in the duty rates of bidis.
  • Customs Act being amended to enable proper checks of imports under FTAs.
  • Anti-dumping duty on PTA abolished to benefit the textile sector.
  • Provisions for checking dumping of goods and imports of subsidized goods being strengthened.
  • Q #1
  • Vivad Se Vishwas’ scheme is aimed at reducing litigations in:
    • direct taxes
    • indirect taxes
    • Both 1 & 2
    • Neither 1 nor 2

3. Urban Landscape

  • Story in numbers
  • Urban Population
    • Currently – 34%
    • By 2030 – 40%
    • By 2050 – 50%
  • Urban share of GDP
    • 2009-10 – 62-63%
    • 2030 – 75%

Urbanization Strategy of India

 

  • Overall Investment in Urban Rejuvenation

Progress | SBM

  • B/w 2014 & 2020
    • 10 Cr toilets in rural areas
    • 65 L household toilets + 6 L public toilets in urban areas
    • 60% municipal wards practice source segregation (from 41%)
  • All cities of 35 States/UTs => ODF
  • 699 districts, 2.5 L GPs and 6 L villages => ODF

AMRUT

  • Focuses on ensuring:
    • water supply, sewerage and septage management
    • storm water drainage
    • urban transport
    • availability of green and open spaces
    • reform management and support
    • capacity building

Progress |AMRUT

Key figures:

  • More than 5000 projects under construction/completion
  • 64% urban households have tap water supply
  • On track to achieve 62% sewerage coverage by 2020

Key reforms:

  • Online Building Permission System in more than 1500 ULBs
  • Replacement of streetlights with LED lights (74 Lakh)
  • Credit Rating (36 cities have A and higher rating)
  • Municipal Bonds worth Rs. 3300 Cr issued
    • Ahmedabad, Amravati, Bhopal, Hyderabad, Pune, Surat & Vizag
  • Jal Shakti Abhiyan – Urban (July 2019) – for water conservation

Progress | SCM

 

Progress | SCM

 

PMAY (U)

 

Progress | PMAY (U)

  • It is rapidly moving towards achieving the vision for providing a pucca house to every household by 2022.
  • Out of 1.03 crore houses approved, 60 lakhs have been grounded for construction, of which 32 lakh houses have been completed and delivered.

Progress | EODB

  • Budget announcements
  • National Infrastructure Pipeline
    • 103 lakh crore worth projects; launched on 31st December 2019 for the period 2020-2025.
    • More than 6500 projects across sectors, to be classified as per their size and stage of development.
    • 16% has been earmarked for urban rejuvenation
  • 1-year internships to fresh engineers in all ULBs in order to enhance the skill of the youth

4. Transport Infra

Context

  • To achieve the GDP of $5 trillion by 2024-25, India needs to spend about $1.4 trillion (` 100 lakh crore) over these years on infrastructure

Roads

  • Road transport is the dominant mode of transportation in terms of its contribution to Gross Value Added (GVA) and traffic share.
    • As per Govt. report, in 2011-12, road transport is estimated to handle 69% and 90% of the countrywide freight and passenger traffic
  • As on Mar 2018, India had a road network of about 59.64 lakh km. The total length of NHs was 1.32 lakh km as on Mar 2019.
  • The pace at which roads have been constructed has grown from 17 kms per day in 2015-16 to 29.7 kms per day in 2018-19.
    • However, the pace seems to have moderated to 12 kms per day in 2019-20.

Railways

  • Indian Railways (IR) with over 68,000 route kms is the third largest network in the world under single management.
  • During 2018-19, it carried 120 crore tonnes of freight and 840 crore passengers making it the world’s largest passenger carrier and 4th largest freight carrier.

Critical Challenges in Railways Modernization

  • Fundamentals of how PPPs would be encouraged
  • R&D for indigenous manufacturing of Rolling Stock

Aviation

  • India is the 3rd largest domestic market for civil aviation in the world.
  • India has 136 commercially-managed airports by AAI and 6 under PPP for Operation, Maintenance and Development of airports.
    • A total of 43 airports have been operationalized under UDAN
  • To ease the strain, 100 more airports are to be made operational by FY 2023-24
  • To bring in efficiency and resources, 6 airports (Ahmedabad, Guwahati, Jaipur, Lucknow, Mangalore, and Thiruvananthapuram) have been taken up for development under PPP mode

Focus areas in Aviation

  • Increasing capacity and service levels in top 30 airports via PPP
  • Increasing no. of airports to about 100 and ensuring that all tier II and tier III cities have their own airports
    • Attracting PPPs in lower tier cities is difficult because of viability – may need VGF / subsidies to make workable
    • AAI is fallback option but concerns about AAI managing many loss-making airports is there

Shipping

  • Around 95% of India’s trade by volume and 68% in terms of value is transported by sea.
  • Despite one of the largest merchant shipping fleet (> 1400) among developing countries, India’s share in total world dead weight tonnage (DWT) is only 0.9% as on January 1, 2019 according to Institute of Shipping Economics and Logistics.

Issues highlighted by Professor G Raghuram

  • Sagarmala is not proceeding at the pace envisaged - a part of the problem is environment but there is also a problem of need
    • Capacity additions may not be needed unless for captive purposes
    • There could possibly be a situation of excess capacity in container domain
      • Could also be the case for coal – as power sector moves towards renewables
    • Some earlier PPPs not able to perform well due to restrictive concession agreements
  • Need restructuring of regulatory regime
  • Connectivity issues on land side, esp. rail, should improve with DFCs and formation of Indian Port Rail Corp. Ltd. (formed in 2015)

 

Air & Rail for Farm

  • Krishi Udaanto be launched by the Ministry of Civil Aviation:
    • Both international and national routes to be covered.
    • North-East and tribal districts to realize Improved value of agri-products
  • Kisan Railto be setup by Indian Railways through PPP:
    • To build a seamless national cold supply chain for perishables (milk, meat, fish, etc.
    • Express and Freight trains to have refrigerated coaches.

Money?.......National Infrastructure Pipeline

  • Launched on 31 Dec 2019, would commence in phases from 2020-21 to 2024-25
  • 103 lakh crore worth projects
    • Energy = 24%
    • Urban = 16%
    • Roads = 19% | Railways = 13% | Airports = 1.3% | Ports = 1%
  • More than 6500 projects across sectors, to be classified as per their size and stage of development.
  • Central Govt. (39%) and State Govt. (39%) will have equal share in funding followed by Private Sector (22%).
    • It is expected that private sector share may increase to 30% by 2025.
  • Q #2
  • Vivad Se Vishwas’ scheme is aimed at reducing litigations in:
    • direct taxes
    • indirect taxes
    • Both 1 & 2
    • Neither 1 nor 2

5. Industries

Industry, Commerce & Investment

  • Investment Clearance Cellproposed to be set up:
    • To provide “end to end” facilitation and support
    • To work through a portal
  • National Technical Textiles Missionto be set up:
    • With four-year implementation period from 2020-21 to 2023-24.
    • At an estimated outlay of Rs 1480 crore.
    • To position India as a global leader in Technical Textiles.
  • New scheme NIRVIKto achieve higher export credit disbursement

 

Industry, Commerce & Investment

  • Turnover of Government e-Marketplace (GeM) proposed to be taken to Rs 3 lakh crore.
  • Scheme for Revision of duties and taxes on exported products to be launched.
    • Exporters to be digitally refunded duties and taxes levied at the Central, State and local levels, which are otherwise not exempted or refunded.
  • All Ministries to issue quality standard orders as per PM’s vision of “Zero Defect-Zero Effect” manufacturing.

 

Infrastructure

  • 100 lakh crore to be invested on infrastructure over the next 5 years
  • National Logistics Policy to be released soon:
    • To clarify roles of the Union Government, State Governments and key regulators.
    • A single window e-logistics market to be created
    • Focus to be on generation of employment, skills and making MSMEs competitive.
  • National Skill Development Agency to give special thrust to infrastructure-focused skill development opportunities.
  • Project preparation facility for infrastructure projects proposed.
    • To actively involve young engineers, management graduates and economists from Universities.
  • infrastructure agencies to involve youth-power in start-ups.

Infrastructure | Connectivity

  • To take advantage of new technologies:
    • Policy to enable private sector to build Data Centre parks throughout the country to be brought out soon
    • Fibre to the Home (FTTH) connections through Bharatnet to link 100,000 GPs this year
    • 6000 crore proposed for Bharatnet programme in 2020-21

Startups

  • A digital platform to be promoted to facilitate seamless application and capture of IPRs.
  • Knowledge Translation Clusters to be set up across different technology sectors including new and emerging areas.
  • Mapping of India’s genetic landscape- Two new national level Science Schemes to be initiated to create a comprehensive database.
  • Early life funding proposed, including a seed fund to support ideation and development of early stage Start-ups.

Financial Sector

 

  • Q #3
  • Vivad Se Vishwas’ scheme is aimed at reducing litigations in:
    • direct taxes
    • indirect taxes
    • Both 1 & 2
    • Neither 1 nor 2

7. Water & Sanitation

 

 

Protocols

  • ODF protocol – independent third party certifies a city as ODF on satisfying certain requirements. To prevent it from slippage, the certification has to be renewed every 6 months.
  • ODF+ protocol – to track maintenance of acceptable levels of cleanliness in community/public toilets so that they are functional and actually used by citizens. 739 cities are ODF+.
  • ODF++ protocol – to track what was happening to faecal sludge being discharged from the toilets => for complete sewage and faecal sludge management. 292 cities are ODF++.
  • SBM Water+ focuses on ensuring that no untreated wastewater is discharged into the open environment.

8. Universal Health Coverage

  • Q #4
  • Vivad Se Vishwas’ scheme is aimed at reducing litigations in:
    • direct taxes
    • indirect taxes
    • Both 1 & 2
    • Neither 1 nor 2

9. Education

10. Skills, Employment & HRD

  • Q #5
  • Vivad Se Vishwas’ scheme is aimed at reducing litigations in:
    • direct taxes
    • indirect taxes
    • Both 1 & 2
    • Neither 1 nor 2

11. Agriculture

12. Environment & Forest

Q #6

  • Vivad Se Vishwas’ scheme is aimed at reducing litigations in:
    • direct taxes
    • indirect taxes
    • Both 1 & 2
    • Neither 1 nor 2

13. Gender Budgeting & Elderly

14. NE Development

  • Q #7
  • Vivad Se Vishwas’ scheme is aimed at reducing litigations in:
    • direct taxes
    • indirect taxes
    • Both 1 & 2
    • Neither 1 nor 2

 

 

 

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