The Evening Wrap: Budget 2021 | No change in IT slabs, new cess introduced

The Hindu Newsletter - Here are the latest updates and the big news stories to follow today [The Hindu Logo]( [Facebook]( [Twitter]( [Youtube]( [Linkedin]( [Instagram]( Monday 01, February 2021 [alt_text]( The Evening Wrap The Evening Wrap: Budget 2021 | No change in IT slabs, new cess introduced [alt_text]( Welcome to the Evening Wrap newsletter, your guide to the day’s biggest stories with concise analysis from The Hindu. We hope you are staying safe. Budget 2021: No change in IT slabs, new cess introduced Finance Minister Nirmala Sitharaman loosened the exchequer’s purse strings and presented an [expansionary Budget for 2021-22]( on Monday, with a push for infrastructure and health care spending even as she sought to reduce the fiscal deficit from an estimated 9.5% of GDP this year without ostensibly raising the tax burden. While there was little direct succour for sectors or sections worst-affected by the pandemic, the government is betting on a real GDP growth of 10%-10.5% in the coming year, riding on the multiplier effect of infrastructure spending which it hopes will also spur demand and job creation. Invoking Rabindranath Tagore’s aphorism, “Faith is the bird that feels the light and sings when the dawn is still dark”, Sitharaman compared the Budget to Team India’s successful comeback in the Test series against Australia and said it provides every opportunity for “our economy to raise and capture the pace that it needs for sustainable growth”. She announced some big-ticket reform signals for global investors, such as enhancing the FDI limit in the insurance sector from 49% to 74%, and an ambitious new strategic disinvestment policy which will kick off with the sale of two public sector banks and a general insurance company in 2021-22. The Budget proposes setting up a new development finance institution to fund infrastructure projects under the National Infrastructure Pipeline, and the creation of an asset reconstruction firm to take over public sector banks’ bad loans to cope with rising NPAs. However, just ₹20,000 crore has been earmarked for recapitalisation of banks, which lower than expectations given the festering stress on bank’s books in the aftermath of the pandemic. Setting aside ₹35,000 crore for the Covid-19 vaccination program, Sitharaman said more funds will be provided if the need arises. The overall Budget outlay for ‘Health and Wellbeing’, she said, was “₹2.23 lakh crore, marking a 137% rise over 2020-21.” Proposing a capital expenditure of ₹5.54 lakh crore in the year, 34.5% higher than 2020-21, the finance minister has targeted a fiscal deficit of 6.8% of GDP, with gross market borrowings of about ₹12 lakh crores. Analysts said this the Budget’s fiscal arithmetic was perhaps the most credible in recent years, but achieving disinvestment and non-tax revenue targets will be critical to meet the 6.8% of GDP target. Some of the Budget highlights: No change in personal income tax; new agri infra cess on select goods Highway and road works announced in Kerala, Tamil Nadu, West Bengal and Assam (all four states go to polls this year) Vehicle scrapping policy to phase out old and unfit vehicles – all vehicles to undergo fitness test in automated fitness centres every 20 years (personal vehicles), every 15 years (commercial vehicles) A new scheme, titled PM Atma Nirbhar Swasthya Bharat Yojana, to be launched to develop primary, secondary and tertiary healthcare No IT filing for people above 75 years who get pension and earn interest from deposits Fiscal deficit stands at 9.5% of the GDP; estimated to be 6.8% in 2021-22 A Unified Securities Market Code to be created, consolidating provisions of the Sebi Act, Depositories Act, and two other laws An IPO of LIC to debut this fiscal Disinvestment target of ₹1.75 lakh crore; strategic sale of BPCL, IDBI Bank, Air India to be completed Margin capital required for loans via Stand-up India scheme reduced from 25% to 15% for SCs, STs and women Gas pipeline project to be set up in Jammu and Kashmir Pradhan Mantri Ujjwala Yojana (LPG scheme) to be extended to cover 1 crore more beneficiaries ‘Cruel blow to federalism, vengeful towards farmers,’ says P Chidambaram Congress leader and former Union finance minister [P. Chidambaram slammed the Union Budget](, stating that, “On the 10-point test that we had suggested on 28th January, the Budget fails on most points. It barely passes on one point. The FM gave out a mind boggling figure of ₹223, 846 crore for Health, a breathtaking “rise” from the Budget Estimate of the current year of ₹94,452 crore. As I had warned, it was a conjurer’s trick. She added the one-time cost of vaccination (₹35,000 crore) and the Finance Commission grants amounting to ₹49,214 crore. She also included the allocations to the Department of Water and Sanitation. Shorn of these add-ons, the allocations for Health were ₹72,934 in 2020-21, and ₹79,602 crore in 2021-22.” Chidamabaram also objected to the government using the Finance Bill provisions to make amendments to non-money bill issues and said it was being done to deny Rajya Sabha its right. “The Finance Minister flattered me by quoting the same couplet from Tirukkural that I had recited in one of my early budget speeches,” said P. Chidambaram. “She flattered to deceive,” he added. “She deceived those who were listening to her speech, especially the MPs, who had no clue that she had imposed cesses on a large number of products, including petroleum and diesel: ₹2.50 on petrol per litre, and ₹ 4.00 on diesel per litre is a cruel blow to the average citizen, including the farmer,” Chidambaram said, adding, “It was a vengeful act against the thousands of farmers who took out the longest tractor rally in history. It was also a cruel blow to federalism because the States do not get a share of the revenue from cesses.” Twitter blocks several accounts posting messages in support of farmers’ stir, unblocks them after furore [ ] Microblogging site Twitter on Monday, citing “legal demands”, [blocked several accounts](, including that of the news magazine The Caravan, the actor Sushant Singh, and political activists and bloggers who were posting messages in support of the ongoing farmers’ agitation. One aberration was the account of Shashi Shekhar, CEO of Prasar Bharati, India’s public service broadcaster, which was also blocked. The blocking of The Caravan’s official handle marked the first time in India that a news media account has been blocked. The accounts were taken down after the Ministry of Electronics and Information Technology (MeITY), following a request by the Ministry of Home Affairs, asked Twitter to act against 250 tweets/Twitter handles. A MeITY statement said that it had directed Twitter to block around 250 Tweets/ Twitter accounts which, as per government allegations, were using #ModiPlanningFarmerGenocide hashtag and “making fake, intimidatory and provocative Tweets on Saturday (January 30).” Most of the blocked accounts had been unblocked at the time of publication of this newsletter. Farmers plan ‘chakka jam’ on February 6; Govt goes for iron bars to create ‘wall’ at Singhu border Farmers’ unions have issued a call for a ‘chakka jam’ or road blockage across the country on February 6. Farmers are expected to block roads from 12 pm to 3pm in protest against the government’s refusal to heed their demand for the repeal of the three agri laws, against the internet ban around protest sites, against the arrest of several farmers, and attempts to evict them from protest sites by force. Meanwhile, workers under the watch of police personnel on Monday were seen hooking iron rods between two rows of cement barriers on a flank of the main highway at the Singhu border to further restrict the movement of the protesting farmers, PTI reported. Another portion of the highway at the Delhi-Haryana border is practically blocked now as a makeshift cement wall has come up there. A worker drilling rods in cross-formation between two rows of solid barriers said, “The other flank was done yesterday. Cement is to be poured in the space between the barriers on this flank to make a makeshift wall.” The move comes days after violent clashes between some protesters and police on January 26 during the tractor parade by the agitating farmers. Security personnel from the paramilitary forces, RAF and CRPF, were seen in relatively less numbers compared to the past few days but a large number of police personnel manned the stretch spanning a mile from the protest site. Besides the makeshift wall on the highway, a small trench was also dug up earlier across an inner street a little off the highway, and cement barricades put up on both the sides. The protesting farmers and leaders at a tent, however, showed no signs of being cowed down and asserted that “these barricades put up around us can’t cage our spirit.” Aung San Suu Kyi, other leaders detained following military coup in Myanmar [Reports says a military coup has taken place in Myanmar and leader Aung San Suu Kyi has been detained under house arrest. ]Reports says a military coup has taken place in Myanmar and leader Aung San Suu Kyi has been detained under house arrest. [Myanmar’s military staged a coup on Monday](, detaining de facto leader Aung San Suu Kyi and declaring that it has taken control of the country for one year under a state of emergency. The intervention came after weeks of rising tensions between the military, which ruled the country for nearly five decades, and the civilian government, over allegations of fraud in November’s elections. The military last week signaled that it could seize power to settle its claims of irregularities in the polls, which Suu Kyi’s National League for Democracy (NLD) party won easily.Suu Kyi and President Win Myint were detained in the capital Naypyidaw before dawn on Monday, NLD spokesperson Myo Nyunt told AFP, just hours before Parliament was meant to resume for the first time since the elections. “We heard they were taken by the military... With the situation we see happening now, we have to assume that the military is staging a coup,” he said.The military then declared, via its own television channel, a one-year state of emergency. The developments triggered a quick response from the United States and Australia, with both calling for the release of detained NLD leaders and the restoration of democracy. India has expressed “deep concern” over the reports of an unfolding military coup in Myanmar. “We have noted the developments in Myanmar with deep concern. India has always been steadfast in its support to the process of democratic transition in Myanmar. We believe that the rule of law and the democratic process must be upheld. We are monitoring the situation closely,” a press statement issued by the Ministry of External Affairs declared. Covid Watch: Numbers and Developments The number of reported coronavirus cases from India stood at 10,764,452 at the time of publishing this newsletter, with the death toll at 1,54,511. In Brief: The Budget session of the Rajya Sabha has been rescheduled and will conclude two days before schedule. The decision in this regard was taken at a meeting between Rajya Sabha Chairman M. Venkaiah Naidu and the floor leaders of all the parties of the upper house. The first part of the Budget session was to conclude on February 15, but the house will now a Saturday and will conclude on February 13. The BCCI and the Tamil Nadu Cricket Association have decided to allow 50% seating of spectators at the second India-England Test to be held at the M.A. Chidambaram stadium, a top TNCA official told PTI on Monday. The move was cleared in a meeting between TNCA and BCCI officials. The first Test begins on Friday while the second match starts on February 13. Crowds have already been allowed for the third and fourth Tests. Evening Wrap will return tomorrow. 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