Budget 2020 -

Economic Development
Total Allocation: Rs 232530 Cr.

Transport & Infra: Rs. 170000 Cr.

Smart Metering: Rs. 22000 Cr.

National Technical Textile: Rs. 1480 Cr.

Quantum Computing: Rs. 8000 Cr.

Bharatnet: Rs. 6000 Cr.

Smart City: Rs. 6450 Cr.

Bangalore Suburban Railway: Rs.18600 Cr.

An Investment clearance cell, a web portal, is proposed to help the

entrepreneurs with end to end facilitation. The government has set up a
Fund of Funds for Startups (FFS) with a corpus of Rs 10,000 crore which is
managed by SIDBI.

5 new smart cities are to be developed in FY’21 by PPP mode at locations

to derive maximum benefit. The allocation for the project remained
unchanged at Rs. 6450 Crore.

India aspires to be a leader in technical textiles for which National

Technical Textiles Mission is launched for Rs. 1480 Crore.

The Government has launched a new scheme, NIRVIK, to facilitate

small traders by providing higher insurance coverage, low premium
and simplified claim settlement mechanism. The Government is also
launching a scheme for reversion of duties and taxes paid on export
products.
Government is looking to generate Rs. 3 Lakh Crore turnovers on its
Government e-Marketplace platform backed by large public
procurement to help the MSME sector.
 Budget 2020 -
Infrastructure
The government has proposed to provide Rs. 1.7 lakh Crore in
transport infrastructure and Rs. 22000 Crore to Power and
Renewable sector in 2020-2021.
National Infrastructure Pipeline with 6500 projects worth 103 lac
Crore is to be completed over next 5 years.
 

A National Logistics Policy would be drafted to create a single-

window logistics market.

2500 2000 2000 9000

km km km km
Access Control Coastal Strategic Economic
Highways Highways Highways Corridors

The Government plans to electrify 27000 km of railway tracks.

Four station re-development projects and operation of 150
passenger trains would be done. 148 km long Bengaluru
Suburban transport project at a cost of Rs. 18600 crore, would
have fares on metro model
The Government is planning to list one of the major ports on the
stock exchanges.

100 more airports would be developed to support the

Udaan Scheme by 2024.
 

The ministry intends to promote smart prepaid meters by

replacing the conventional meters within next 3 years.
 BUDGET 2020
FINANCE SECTOR

Banks & NBFCs

Increament of the deposit Insurance to Rs. 5,00,000 allowed.

IDBI Bank privatization

Reduction of debt recovery for NBFCs to be eligible under

the SARFAESI act to an asset size of Rs. 100 Cr. or a loan size

of Rs. 50 lakhs.

Proposal of Act Amendment to allow the NBFCs to provide

invoice financing to MSMEs through TReDS.

MSME Sector
A new scheme has been proposed through which banks can

provide subordinate debt to MSME. Such debt would be

recognized as quasi-equity and would be fully guaranteed by

CGTMSE.

An app-based invoice financing loan product for the MSME

sector

Exports Sector
For selected sectors like pharmaceuticals, auto components and

others, the Government proposed to extend handholding

support – for technology upgradations, R&D, business strategy to

make them competitive in export markets. A scheme of Rs. 1000

crore will be anchored by EXIM Bank together with SIDBI in this

respect.

Government and
Corporate Bond Market
The FPI limit of corporate bonds has been increased to 15%.

Certain Government securities are fully open to the NRIs.

The Government also proposed to float a Debt-ETF

consisting primarily of Government Securities.

Disinvestment
To meet its ambitious target of 2.1 lakh crore of disinvestment

in FY’21, the Government would sell a part of its stake in the

LIC through IPO.

The Government also expects a dividend of around Rs. 65000

Crore from the PSUs.

Fiscal Deficit
Revised Estimated Expenditure FY’20: Rs. 26.99 lakh 

Revised Estimated Revenue FY'20: Rs. 19.32 lakh Crores.

Budget Estimate Expenditure FY’21: Rs. 30.42 lakh Crores

Budget Estimate Revenue FY’21: Rs. 22.46 lakh Crores.

Net Market Borrowings (2019-20): Rs. 4.99 lakh Crores

Net Market Borrowings (2020-21): Rs. 5.36 lakh Crores.

The revised estimate for fiscal deficit in FY’20 is at 3.8% of the GDP while the

budgeted estimate for fiscal deficit in FY’21 is at 3.5% of the GDP.

 TAX REFORMS
Changes in Income Tax Rates was the most anticipated and
awaited policy change for this year's Union Budget and as
per everyone's expectations Finance Minister announced the
new tax rates and revised slabs. Their effectiveness however
is yet to proven.

30% People opting for

the newly
20% introduced Income
Tax slabs will not be
10% eligible for almost
any deductions.
0% Adjacent figure shows the
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new tax rate slabs.

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The DDT has been abolished from both

company and mutual fund levels.
Instead it will now be taxed in the
hands of investors at their slab rates.
In addition TDS will also be deducted
on mutual dividends above Rs.5000
per year @ 10%.
This change will particular help people
in lower income bracket as their
dividend income will now be taxed at a
lower rate.

ESOP play an very important role in employee

compensation in start-ups and help them in
retaining the talent ESOP are currently taxed
at source (TDS).
According to the proposal, the tax in such a
scenario will now be required to be paid as
follows:
i) after the expiry of 5 years from the end of the
relevant financial year in which shares are
allotted; or
(ii) from the date of the sale of such specified
security or sweat equity share by the
employee; or
(iii) from the date on which the employee
ceases to be the employee of the person
Such tax has to be deposited within 14 days of
any of the above-mentioned event taking
place.

Vivad se Vishawas Scheme

Under the tax dispute settlement
scheme, any company that has
legacy tax issues just need to pay
the tax demanded before march-
end and the interest and penalties
pending will be waived off.
Government can get an immediate
revenue of as much as Rs.50,000
crore through this scheme while
reducing the burden on litigation
system.
 BUDGET 2020
EDUCATION
TOTAL ALLOCATION OF RS. 99,312 CR. FOR EDUCATION
RS 3,000 CRORE FOR SKILL DEVELOPMENT.

RS. 1.18 LAKH CR.

‘Technology-driven learning’
The programme will be offered by
the top 100 universities in India
in the National Institutional
Ranking framework.

INTERNSHIPS
FOR ENGINEERS
The Budget 2020 included one
year Internship programmes for
engineers in various Urban
Bodies.

IND - SAT
an scholarship eligibility test, is
planned to held in various
Asian and African countries to
invite students to
“Study in India” by providing
scholarships to them.

It is proposed to attach a Medical College with existing

district hospitals.  Currently there are 536 Medical
Colleges in India having about 77,428 seats.
To cater to the demand of teachers,
nurses, para-medical staff and care-givers abroad, a
collaboration between Ministry of Health and Skill
Development is proposed to provide language training
to these professionals in order to provide for the
requirements.
8

6.43
5.81 Education expenditure has
4

4.83
4.35 remained stagnant to close
3.92
2

3.54 to 3% of GDP over the years.

0
5

BE
-1

-1

-1

-1

-1
14

15

16

17

18

0
-2
20

20

20

20

20

19
20

Trends in Expenditure in Education by General Government

(Combined Centre and States)
in Lakh Cr.