Statement Of Cash Receipts, Disbursements And Changes In Fund Balance Budget And Act: Fill & Download for Free

Massachusetts Budget ProcessThe Governor gets the ball rolling and actually is allowed to send their budget to the House as a Bill, this is not the case in all states. This is the process:1. Governor's BudgetThe annual budget process begins each year when the Governor files recommendations as a bill with the House of Representatives. Under the state Constitution, the Governor must submit a proposal by the 4th Wednesday in January or, in the event of a new term, within five weeks later. This bill is called 'House 1’ or ‘House 2’ depending on the year.2. House Ways & Means BudgetThe House Committee on Ways and Means examines the Governor’s proposal and releases its own recommendations for the annual budget for deliberation by the House of Representatives. Prior to release of the House Ways and Means Budget, Joint Ways and Means Committee budget hearings are held across the state.3. House BudgetThe full House of Representatives considers amendments to the House Ways and Means recommendations and debates their inclusion in the bill. The House of Representatives then approves a final, amended version of the bill which is then sent to the Senate for consideration.4. Senate Ways & Means BudgetThe Senate Committee on Ways and Means examines both the Governor’s proposal and the House proposal and releases its own recommendations for the annual budget for deliberation by the Senate.5. Senate BudgetThe full Senate considers amendments to the Senate Ways and Means recommendations and debates their inclusion in the bill. The Senate then approves a final, amended version of the bill.6. Conference CommitteeThe House and Senate appoint three members each to a "conference committee" to reconcile the differences between the House and Senate proposals. One member of the minority party must be appointed by each branch. The conference committee reports a final compromise bill to the House and Senate for a final vote of acceptance in each branch.7. Governor's ActionsThe Governor has 10 days to review the budget and take action to either approve or veto the budget. The Governor may approve or veto the entire budget, veto or reduce specific line items, veto outside sections or submit changes as an amendment to the budget for further consideration by the Legislature. (NOTE: Governors in many states have the line item veto, the President of the US does not.)8. Legislative OverridesThe Legislature can override the Governor’s vetoes with a two-thirds vote in each branch. The House must vote first to override any vetoes before they may be considered by the Senate.9. Final BudgetFollowing any Legislative overrides, the budget is finalized and is commonly referred to as the “General Appropriations Act” for the upcoming fiscal year.This process takes about 7 months.Massachusetts Budget ProcessNew York State Budget ProcessNew York State uses an executive budget model. Under this system, the Executive is responsible for developing and preparing a comprehensive, balanced budget proposal, which the Legislature modifies and enacts into law. The Governor is required by the State Constitution to seek and coordinate requests from agencies of State government, develop a “complete” plan of proposed expenditures and the revenues available to support them (a “balanced budget”), and submit a budget to the Legislature along with the appropriation bills and other legislation required to carry out budgetary recommendations. The Governor is also required by the State Finance Law to manage the budget through administrative actions during the fiscal year.The State’s fiscal year begins April 1 and ends on March 31. However, the actual “budget cycle,” representing the time between early budget preparation and final disbursements, begins some nine months earlier and lasts approximately 27 months – until the expiration of the State Comptroller’s authority to honor vouchers against the previous fiscal year’s appropriations.1. Agency Budget Preparation (June–September/October)http://...Preparation of budget requests varies among agencies reflecting their size, complexity and internal practice. Typically, budget development begins at the program or subdepartmental level, with staff preparing individual program requests. The head of the agency or its top fiscal officer may hold internalhearings at which program managers outline their budgetary needs.Although agencies begin to analyze their budget needs as early as May or June, the formal budget cycle begins when the Budget Director issues a policy memorandum - the “call letter” - to agency heads. The call letter outlines, in general terms, the Governor’s priorities for the coming year, alerts the agency heads to expected fiscal constraints and informs agencies of the schedule for submitting requests to the Division of the Budget. The call letter signals the official start of the budget process.By early-mid fall, a final program package is assembled by each agency, which is guided by the instructions set forth by the Division of the Budget, reviewed for consistency with the call letter, and approved by the agency head.2. Division Of The Budget Review (September/October–December)http://...In accordance with the schedule outlined in the call letter, agencies typically submit their budget requests to the Division of the Budget in early-mid fall, with copies provided to the legislative fiscal committees. Examination units within the Division then analyze the requests of the agencies for which they have responsibility. Examiners may seek additional information from the agencies and may hold informal hearings or meetings with agency management to clarify agency requests and seek a more precise definition of agency priorities. By the end of October, examination units have also usually determined funding requirements to continue agency programs at current levels in the new year.In November, the Budget Director conducts constitutionally authorized “formal” budget hearings, giving agency heads an opportunity to present and discuss their budget requests and giving the staff of the Division of the Budget and the Governor’s office an opportunity to raise critical questions on program, policy and priorities. As provided in the Constitution, representatives of the Legislature also participate in the hearings.Under reform legislation passed in January 2007, a “quick start” budget process was instituted to help provide an earlier understanding of the state’s available funding resources. By November 5, the Division of the Budget, the Assembly, the Senate, and the comptroller release detailed forecasts of revenues and expenditures. After a public meeting with the respective staff members of these parties, DOB, the Senate, and the Assembly release a consensus forecast of the state’s financial position by November 15.Through late November, the Division’s examiners transform agency requests into preliminary budget and personnel recommendations which are reviewed in detail with the Director. They also prepare the appropriation bills and any other legislation required to carry out these recommendations. Concurrently, the Division of the Budget’s fiscal planning staff is reassessing economic projections, investigating possible changes in the revenue structure, analyzing trends in federal funding, and preparing the Financial Plan that describes and forecasts the State’s fiscal condition. The Financial Plan is prepared both on a cash basis and according to Generally Accepted Accounting Principles (GAAP).By early December, the Division of the Budget will normally have completed its preliminary recommendations on both revenues and expenditures, and presented them to the Governor and the Governor’s staff. Budget staff then prepare the tables and the narrative (the “budget story”) that accompany each agency budget, and the descriptions and forecasts of individual revenue sources.3. The Governor’s Decisions (November - January)The Governor’s staff, who are also preparing the annual “State of the State” message to the Legislature, work with the Division throughout the development of the budget. The Governor is kept up-to-date on changing economic and revenue forecasts and confirms that executive program priorities are accurately reflected in the budget. Based on the preliminary recommendations and the most current reading of the economic and fiscal environment, the final Executive Budget recommendations are formulated in a series of meetings between Division of the Budget staff and the Governor. These sessions focus on major fiscal and policy issues and may lead to significant revisions in agency budgets.4. Legislative Action (January–March)http://...Typically by mid-January – or, following a gubernatorial election year, by February 1 – the Governor submits his Executive Budget to the Legislature, along with the related appropriation, revenue, and budget bills. The State’s five-year Financial Plan, Five-Year Capital Program and Financing Plan, and financial information supporting the Executive Budget are also submitted with the Executive Budget. The Executive Budget documents are available here.The Legislature, primarily through its fiscal committees – Senate Finance and Assembly Ways and Means – analyzes the Governor’s spending proposals and revenue estimates, holds public hearings on major programs, and seeks further information from the Division of the Budget and other State agencies. Following that review, the Legislature acts on the appropriation bills submitted with the Executive Budget.Under budget reform legislation passed in 2007, the Legislature is required to use a conference committee process between the two houses to organize its deliberations, set priorities, and reach agreement on a Budget. In addition, the State Finance Law requires that the Executive and Legislature convene a consensus economic and revenue forecasting conference and issue a consensus report on tax, lottery and miscellaneous receipts on or before March 1. If the parties fail to reach consensus, the Comptroller is required to issue a binding revenue forecast by March 5.Based on their separate and joint deliberations, the two houses reach agreement on spending and revenue recommendations, which are reflected in amended versions of the Governor’s proposed appropriation bills and related legislation, and approved by both houses. These amended bills are available from the Senate and Assembly Document Rooms located in the Capitol and the Legislative Office Building, and on the Internet.The appropriation bills, except for those items which were added by the Legislature and the appropriations for the Legislature and Judiciary, become law without further action by the Governor. The Governor must approve or disapprove all or parts of the appropriation bills covering the Legislature and Judiciary, and may use the line item veto to disapprove items added by the Legislature while approving the remainder of the bill. As provided in the Constitution, the Legislature may override the Governor’s veto by a vote of two-thirds of the members of each house. The appropriation bills legally authorize the expenditure of funds during the new fiscal year.Prior to passage of the appropriation bills, the Legislature must issue a summary of the proposed changes to the budget to its members. The Division of the Budget is also required to prepare a report that summarizes the impact of the Legislature’s actions on the State’s multi-year Financial Plan. Once the Governor completes his review of the Legislature’s actions, the Division then issues a comprehensive Enacted Budget Report that contains the State’s official Financial Plan projections for the current and successive fiscal years. The Legislature must also issue a report describing appropriation changes and the effect of the Enacted Budget on State agency employment levels.5. Budget Execution (April–March)At this point the budget process enters a new phase: budget execution. As a first step, the Division of the Budget approves “certificates of allocation” informing the State Comptroller that accounts may be established as specified in the certificates and that vouchers drawn against the accounts may be honored.In addition, the Division of the Budget keeps a close watch throughout the year on the flow of revenue and the pattern of expenditures against its projections. This information is reflected in quarterly updates of the Financial Plan which are provided to the Legislature as required by law in April (or as soon as practicable after budget enactment), July, October and with the Executive Budget for the ensuing year (usually January).The Debt Reform Act of 2000 requires the Governor to report on the State’s compliance with statutory caps placed on new debt issued after March 31, 2000. The State annually reports these findings in the Financial Plan Update closest to October 31.These updates serve as the basis of financial management during the fiscal year, and may alert both the Governor and the Legislature to potential problems in maintaining budget balance as the State fiscal year unfolds.Shortly after the end of the fiscal year, the Division of the Budget issues a comprehensive report that (1) compares unaudited year-end results to the projections set forth in the Enacted Budget and in the final update to the Financial Plan and (2) summarizes the reasons for the annual change in receipts and disbursements.The Budget Process, New York StateTexas State Budget ProcessIn Texas, the legislature, specifically the Legislative Budget Board is responsible for preparing the preliminary budget. Since the state has a divided executive branch, the state comptroller is also involved in the process.The Texas budget process begins during the year prior to each regular session of the state's Legislature, which are held in odd-numbered years.1. Legislative Appropriations RequestsEach state agency prepares a detailed legislative appropriations request (LAR) under the guidelines of the state's Legislative Budget Board (LBB). These LARs itemize the funding each agency feels it needs to pursue its various tasks, and include performance measures designed to ensure the money is spent efficiently and effectively.These LARs generally are sent to LBB, the Comptroller's office and several other state agencies by the end of summer or in early fall.2. LBB and Governor's Office of the Budget, Planning and Policy Hearings.The LBB and the Governor's Office of Budget, Planning and Policy hold hearings on their content.In the fall before the session, LBB uses the LARs as a basis to prepare a draft of the state's general appropriations bill, which will provide state agencies and institutions with funding for the following two fiscal years.3. State Comptroller Issues the Biennial Revenue Estimate.At the beginning of the legislative session, the Comptroller's office issues its biennial revenue estimate (BRE), a careful estimate of the funds likely to be available from taxes and other revenue sources over the next two years. The Texas Constitution makes the BRE a cap on legislative spending for this period.4. House and Senate HearingsBoth the Texas House Committee on Appropriations and the Senate Finance Committee hold hearings on the general appropriations bill, and make changes to it reflecting the BRE's limits and their funding priorities.5. Approval of House and Senate hearing versions.When the committees complete their versions of the bill, they send them to the full House and Senate, respectively, for approval.6. Bicameral Conference Committee to resolve differences in billsThese two bills then go to a conference committee made up of members of both the House and Senate, which resolves their differences to produce a single bill reflecting the wishes of both bodies.7. Both Houses Vote on Combined Bill.8. Certification by State Comptroller.Once approved, it goes to the Comptroller's office for "certification," a formal statement from the Comptroller that the bill spends no more than the amounts reflected in the BRE.9. Governor's signature.The bill then faces a final hurdle, the governor's signature. Texas has a "line-item veto," allowing the governor to trim individual spending items from the bill as he or she sees fit. (This veto can be overridden a two-thirds majority vote in each house, but in practice the governor's decisions are rarely challenged.)Once signed, the bill becomes law, directing the state's finances for two more years.http://www.texastransparency.org/State_Finance/Budget_Finance/Budget_Primer.phpEach state's budget process is slightly different so if you want to know about a specific state I suggest you go to that state's website to find out.

Source: Prelims Specific Notes for IAS (Telegram Channel)The economic slowdown in the current year has made reducing fiscal deficit a particularly difficult task.Yet, it is commendable that the fiscal deficit has been reined in at 3.8% of GDP in the recent Budget, which is a slippage of 0.5% compared to the target of 3.3%.For the coming year, the Finance Minister has proposed a reduction in the deficit to 3.5%.Fiscal Responsibility and Budget Management (FRBM) Act, 2003The Fiscal Responsibility and Budget Management (FRBM) Act was enacted in 2003 to provide for the responsibility of the Central Government to ensure inter-generational equity in fiscal management and long-term macro-economic stability.It does so by removing fiscal impediments in the effective conduct of monetary policy and prudential debt management consistent with fiscal sustainability through limits on the Central Government borrowings, debt and deficits, greater transparency in fiscal operations of the Central Government and conducting fiscal policy in a medium-term framework.It extends to the whole of India.When it was introduced for the first time, its target was to bring down the fiscal deficit to 3 percent of the GDP by 2008.However, the act suffered several challenges, such as the global financial crisis of 2007, when it came to implementation due to several reasons.To ensure that the States too are financially prudent, the 12th Finance Commission’s recommendations in 2004 linked debt relief to States with their enactment of similar laws.The States have since enacted their own respective Financial Responsibility Legislation, which sets the same 3% of Gross State Domestic Product (GSDP) cap on their annual budget deficits.The targets set under the Act were postponed several times in later years though some other goals of the Act including phasing out of government borrowing from the RBI were implemented.A committee was set up under NK Singh in 2016 to review the act.The committee on its part recommended that the government should target a fiscal deficit that is 3 percent of the GDP by 2020 and bring it down to 2.5 percent by 2023.However, low revenue collections due to GST implementation and rise in oil prices affected achieving the set target.Fiscal management principlesThe Central Government shall:(a) take appropriate measures to limit the fiscal deficit upto three per cent of gross domestic product (nominal) by the 31st March, 2021;(b) endeavour to ensure that—(i) the general Government debt does not exceed sixty per cent of gross domestic product by the end of financial year 2024-2025;(ii) the Central Government debt does not exceed forty per cent of gross domestic product by the end of financial year 2024-2025,(c) not give additional guarantees with respect to any loan on security of the Consolidated Fund of India in excess of one-half per cent. of gross domestic product, in any financial year;The FRBM Act prescribes that the Debt to GDP ratio of the Government of India should be brought down to 40% by 2024-25.Section 3 of the Fiscal Responsibility and Budget Management (FRBM) Act, 2003 requires the Government to place in both the Houses of Parliament along with Annual Financial Statement and Demands for Grants three Statements of Fiscal Policy viz.,the Medium-term Fiscal Policy Statement,the Fiscal Policy Strategy Statement andthe Macroeconomic Framework StatementThis Section was recently amended to require the Government to lay a Fourth Statement viz., the Medium Term Expenditure Framework (MTEF) Statement in both the Houses of Parliament, immediately following the Session of the Parliament in which the Budget has been presented.The “Medium-term Expenditure Framework” statement set a three-year rolling target for expenditure indicators.The Fiscal Policy Strategy Statement outlines the strategic priorities of Government in the fiscal area for the ensuing financial year relating to taxation, expenditure, lending and investments, administered pricing, borrowings and guarantees.The Macro-economic Framework Statement shall contain an assessment of the growth prospects of the economy with specification of underlying assumptions.The Medium-term Fiscal Policy Statement shall set forth a three-year rolling target for prescribed fiscal indicators with specification of underlying assumptions.Deviations from the Act are allowed:Provided that exceeding annual fiscal deficit target due to ground or grounds of:national security, act of war, national calamity,collapse of agriculture severely affecting farm output and incomes,structural reforms in the economy with unanticipated fiscal implications,decline in real output growth of a quarter by at least three per cent points below its average of the previous four quarters, may be allowed for the purposes of this section.Any such deviations from fiscal deficit target shall not exceed one-half per cent of the gross domestic product in a year.Where the fiscal deficit is allowed to vary from the target prescribed, a statement explaining the reasons thereof and the path of return to annual prescribed targets under this section shall be laid, as soon as may be, before both the Houses of Parliament.Under the FRBM Act, once the trigger is exercised, the government can also monetise the deficit with RBI.Jurisdiction of civil courts barredNo civil court shall have jurisdiction to question the legality of any action taken by, or any decision of, the Central Government, under this Act.In this Act, unless the context otherwise requires:“Fiscal deficit” means the excess of total disbursements, from the Consolidated Fund of India, excluding repayment of debt, over total receipts into the Fund (excluding the debt receipts), during a financial year;“Central Government debt” means:(i) the total outstanding liabilities of the Central Government on the security of the Consolidated Fund of India, including external debt valued at current exchange rates;(ii) the total outstanding liabilities in the public account of India; and(iii) such financial liabilities of any body corporate or other entity owned or controlled by the Central Government, which the Government is to repay or service from the annual financial statement, reduced by the cash balance available at the end of that date.“General Government debt” means the sum total of the debt of the Central Government and the State Governments, excluding inter-Governmental liabilities.“Gross Domestic Product” means the sum of the gross value added by all resident production units plus that part of taxes, less subsidies, on products, which is not included in the valuation of output, during a financial year, reckoned at current market prices, as published by the Central Statistics Office from time to time.“Real gross domestic product” means gross domestic product, reckoned at constant prices, as published by the Central Statistics Office from time to time.“Real Output Growth” means growth in real gross domestic product.The Act originally prescribed the following two basic fiscal indicators: Fiscal deficit and revenue deficit.An additional fiscal indicator, namely, effective revenue deficit, has been prescribed by an amendment to the FRBM Act by the Finance Act, 2012.As a broad rule, it is considered fiscally imprudent for a government to borrow money for “revenue” purposes.As a result, the FRBM Act of 2003 had mandated that, apart from limiting the fiscal deficit to 3% of the nominal GDP, the revenue deficit should be brought down to 0%.This would have meant that all the government borrowing (or fiscal deficit) for the year would have funded only capital expenditure by the government.In 2018 when the Union government stopped targeting revenue deficit and instead focussed only on fiscal deficit.What is the significance of not targeting revenue deficit?Because with no compulsion to reduce revenue deficit, the government has, over the past couple of years, been containing the fiscal deficit by reducing its capital expenditure. “As a result, we have now reached a point where adhering to the FRBM Act is actually sending a contractionary pulse. In other words, adherence to FRBM Act is achieving the exact opposite of what it was supposed to do and this is perhaps one factor that contributes to the “structural” slowdown in the Indian economy.In any economy, when the government spends money or cuts taxes it has an impact on the economic activity of the country (measured in terms of a change in the nominal GDP or total incomes). But this impact (also called the “Multiplier” effect) is quite different for revenue expenditure and capital expenditure.To be exact, as a paper, titled “Fiscal Multipliers for India” by Sukanya Bose and N R Bhanumurthy shows, the multiplier is less than 1 for revenue expenditure and over 2.5 for capital expenditure. In other words, when the government spends Rs 100 on increasing salaries in India, the economy grows by a little less than Rs 100. But, when the government uses that money to make a road or a bridge, the economy’s GDP grows by Rs 250.If governments spend on capital building instead of frittering the money they have on populist schemes like higher salaries or sops, the economy would benefit by two-and-a half-times more.Do you know?Gross Fiscal Deficit is defined as the excess of total expenditure of the government over the total non-debt creating receipts.Net fiscal deficit can be arrived at by deducting net domestic lending from gross fiscal deficit.Revenue deficit arises when the government’s actual net receipts is lower than the projected receipts.Revenue deficit signifies that government’s own earning is insufficient to meet normal functioning of government departments and provision of services.An increase in the ratio of revenue deficit to gross fiscal deficit indicates an increase in the utilization of borrowed funds for revenue purposes.It indicates increase in liabilities of the Central Government without increase in the assets of that Government.The difference between fiscal deficit and revenue deficit is the government’s capital expenditure.Effective Revenue DeficitIn the 2012-13 budget, the concept of effective revenue deficit was introduced that excluded grants for the creation of capital assets from conventional revenue deficit.Effective Revenue Deficit is the difference between revenue deficit and grants for creation of capital assets.Grants for creation of capital assets are defined as “the grants-in-aid given by the Central Government to the State Governments, constitutional authorities or bodies, autonomous bodies and other scheme implementing agencies for creation of capital assets which are owned by the said entities”.The concept of effective revenue deficit has been suggested by the Rangarajan Committee on Public Expenditure.It is aimed to deduct the money used out of borrowing to finance capital expenditure.The concept has been introduced to ascertain the actual deficit in the revenue account after adjusting for expenditure of capital nature.Focusing on this will help in reducing the consumptive component of revenue deficit and create space for increased capital spending.Trade deficit: A nation has a trade deficit if the total value of goods and services it imports is greater than the total value of those it exports.Primary Deficit: It is the difference between the current year’s fiscal deficit (total income – total expenditure of the government) and the interest paid on the borrowings of the previous year.Primary Deficit = Fiscal Deficit (Total expenditure – Total income of the government) – Interest payments (of previous borrowings).Fiscal deficit is also defined as the difference between the total expenditure of the government and its total income.What does Primary Deficit indicate?: Primary deficit is measured to know the amount of borrowing that the government can utilize, excluding the interest payments.A decrease in primary deficit shows progress towards fiscal health.Note that the difference between the primary deficit and fiscal deficit reflects the amount of interest payment on public debt generated in the past.Hence, when the primary deficit is zero, the fiscal deficit becomes equal to the interest payment. This means that the government has resorted to borrowings just to pay off the interest payments. Further, nothing is added to the existing loan.Factor income: It is determined by subtracting income made by citizens of a country on their foreign investments from income earned by foreigners on their investments within the country.Current/Financial transfers: They include interest earnings, foreign remittances, donations, aids and grants, official assistance, pensions etc.Current account deficit/balance: trade deficit + factor income + financial transfers ORCAD/CAB = (X−M) + (NY+NCT) where:X = Exports of goods and servicesM=Imports of goods and servicesNY=Net income abroadNCT=Net current transfersBalance of payments: The balance of payments is the sum of all transactions between a nation and all of its international trading partners.Fiscal expansionFiscal expansion is generally defined as an increase in economic spending owing to actions taken by the government.Expansionary fiscal policy can also lead to inflation because of the higher demand in the economy.A general increase in overall spending can cause the cash flow leaving the country to increase as consumers and the government both purchase more. This increases the debit side of the balance of payments.Fiscal expansion generally worsens the Inflation and Balance of payments.

Three prominent themes of the BudgetAspirational India - better standards of living with access to health, education and better jobs for all sections of the societyEconomic Development for all - “Sabka Saath , Sabka Vikas , Sabka Vishwas”.Caring Society - both humane and compassionate; Antyodaya as an article of faith.Three broad themes are held together by:Corruption free, policy-driven Good Governance.Clean and sound financial sector.Ease of Living underlined by the three themes of Union Budget 2020-21.Three components of Aspirational IndiaAgriculture, Irrigation, and Rural DevelopmentWellness, Water, and SanitationEducation and SkillsSixteen Action Points for Agriculture, Irrigation and Rural DevelopmentRs. 2.83 lakh crore to be allocated for the following 16 Action Points:Rs. 1.60 lakh crore for Agriculture, Irrigation & allied activities.Rs. 1.23 lakh crore for Rural development & Panchayati Raj. -Agriculture credit:Rs. 15 lakh crore target set for the year 2020-21.PM-KISAN beneficiaries to be covered under the KCC scheme.NABARD Re-finance Scheme to be further expanded.Comprehensive measures for 100 water-stressed districts proposed.Blue Economy:Rs. 1 lakh crore fisheries’ exports to be achieved by 2024-25.200 lakh tonnes fish production targeted by 2022-23.3477 Sagar Mitras and 500 Fish Farmer Producer Organisations to involve youth in fisheries extension.Growing of algae, sea-weed and cage culture to be promoted.Framework for development, management and conservation of marine fishery resources.Kisan Rail to 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.Krishi Udaan to 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.One-Product One-District for better marketing and export in the Horticulture sector.Balanced use of all kinds of fertilizers - traditional organic and innovative fertilizers.Measures for organic, natural, and integrated farming:Jaivik Kheti Portal – online national organic products market to be strengthened.Zero-Budget Natural Farming (mentioned in July 2019 Budget) to be included.o Integrated Farming Systems in rain-fed areas to be expanded.o Multi-tier cropping, bee-keeping, solar pumps, solar energy production in non-cropping season to be added.PM-KUSUM to be expanded:20 lakh farmers to be provided for setting up stand-alone solar pumps.Another 15 lakh farmers to be helped to solarise their grid-connected pump sets.Scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid.Village Storage Scheme:To be run by the SHGs to provide farmers a good holding capacity and reduce their logistics cost.Women, SHGs to regain their position as Dhaanya Lakshmi.NABARD to map and geo-tag agri-warehouses, cold storages, reefer van facilities, etc.Warehousing in line with Warehouse Development and Regulatory Authority (WDRA) norms:Viability Gap Funding for setting up such efficient warehouses at the block/taluk level.Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) to undertake such warehouse building.Financing on Negotiable Warehousing Receipts (e-NWR) to be integrated with e-NAM.State governments who undertake implementation of model laws (issued by the Central government) to be encouraged.Livestock:Doubling of milk processing capacity to 108 million MT from 53.5 million MT by 2025.Artificial insemination to be increased to 70% from the present 30%.MNREGS to be dovetailed to develop fodder farms.Foot and Mouth Disease, Brucellosis in cattle and Peste Des Petits ruminants (PPR) in sheep and goat to be eliminated by 2025.Deen Dayal Antyodaya Yojana – 0.5 crore households mobilized with 58 lakh SHGs for poverty alleviation.Wellness, Water and SanitationRs. 69,000 crore allocated for overall Healthcare sector.Rs. 6400 crore (out of Rs. 69,000 crore) for PM Jan Arogya Yojana (PMJAY):More than 20,000 hospitals already empanelled under PM Jan Arogya Yojana (PMJAY).Viability Gap Funding window proposed for setting up hospitals in the PPP mode.Aspirational Districts with no Ayushman empanelled hospitals to be covered in the first phase.Targeting diseases with an appropriately designed preventive regime using Machine Learning and AI.Jan Aushadhi Kendra Scheme to offer 2000 medicines and 300 surgicals in all districts by 2024.TB Harega Desh Jeetega campaign launched - commitment to end Tuberculosis by 2025.Rs. 3.60 lakh crore approved for Jal Jeevan Mission:Rs. 11,500 crore for the year 2020-21.Augmenting local water sources, recharging existing sources, and promoting water harvesting and de-salination.Cities with million-plus population to be encouraged to achieve the objective during the current year itself.Rs.12, 300 crore allocation for Swachh Bharat Mission in 2020-21:Committment to ODF-Plus in order to sustain ODF behaviour.Emphasis on liquid and grey water management.o Focus also on Solid-waste collection, source segregation, and processing.Education and SkillsRs. 99,300 crore for education sector and Rs. 3000 crore for skill development in 2020-21.New Education Policy to be announced soon.National Police University and National Forensic Science University proposed for policing science, forensic science, and cyber-forensics.Degree level full-fledged online education program by Top-100 institutions in the National Institutional Ranking Framework.Up to 1-year internship to fresh engineers to be provided by Urban Local Bodies.Budget proposes to attach a medical college to an existing district hospital in PPP mode.Special bridge courses to be designed by the Ministries of Health, and Skill Development:To fulfill the demand for teachers, nurses, para-medical staff and care-givers abroad.To bring in equivalence in the skill sets of the workforce and employers’ standards.150 higher educational institutions to start apprenticeship embedded degree/diploma courses by March 2021.External Commercial Borrowings and FDI to be enabled for education sector.Ind-SAT proposed for Asian and African countries as a part of Study in India program.Economic DevelopmentIndustry, Commerce and InvestmentRs. 27,300 crore allocated for 2020-21 for development and promotion of Industry and Commerce.Investment Clearance Cell proposed to be set up:o To provide “end to end” facilitation and support.o To work through a portal.Five new smart cities proposed to be developed.Scheme to encourage manufacture of mobile phones, electronic equipment and semi-conductor packaging proposed.National Technical Textiles Mission to be set up:o With four-year implementation period from 2020-21 to 2023-24.o At an estimated outlay of Rs 1480 crore.o To position India as a global leader in Technical Textiles.New scheme NIRVIK to be launched to achieve higher export credit disbursement, which provides for:o Higher insurance coverageo Reduction in premium for small exporterso Simplified procedure for claim settlements.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.o 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.InfrastructureRs.100 lakh crore to be invested on infrastructure over the next 5 years.National Infrastructure Pipeline:o Rs. 103 lakh crore worth projects; launched on 31st December 2019.o More than 6500 projects across sectors, to be classified as per their size and stage of development.A National Logistics Policy to be released soon:o To clarify roles of the Union Government, State Governments and key regulators.o A single window e-logistics market to be createdo 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.o To actively involve young engineers, management graduates and economists from Universities.Infrastructure agencies of the government to involve youth-power in start-ups.Rs.1.7 lakh crore proposed for transport infrastructure in 2020-21.Highways:Accelerated development of highways to be undertaken, including:o 2500 Km access control highways.o 9000 Km of economic corridors.o 2000 Km of coastal and land port roads.o 2000 Km of strategic highways.Delhi-Mumbai Expressway and two other packages to be completed by 2023.Chennai-Bengaluru Expressway to be started.Proposed to monetise at least 12 lots of highway bundles of over 6000 Km before 2024.Indian Railways:Five measures:o Large solar power capacity to be set up alongside rail tracks, on land owned by railways.o Four station re-development projects and operation of 150 passenger trains through PPP.o More Tejas type trains to connect iconic tourist destinations.o High speed train between Mumbai and Ahmedabad to be actively pursued.o 148 km long Bengaluru Suburban transport project at a cost of Rs 18600 crore, to have fares on metro model. Central Government to provide 20% of equity and facilitate external assistance up to 60% of the project cost.Indian Railways’ achievements:o 550 Wi-fi facilities commissioned in as many stations.o Zero unmanned crossings.o 27000 Km of tracks to be electrified.Ports & Water-ways:Corporatizing at least one major port and its listing on stock exchanges to be considered.Governance framework keeping with global benchmarks needed for more efficient sea-ports.Economic activity along river banks to be energised as per Prime Minister’s Arth Ganga concept.Airports:100 more airports to be developed by 2024 to support Udaan scheme.Air fleet number expected to go up from present 600 to 1200 during this time.Electricity:“Smart” metering to be promoted.More measures to reform DISCOMs to be taken.Power:Rs.22, 000 crore proposed for power and renewable energy sector in 2020-21.Expansion of national gas grid from the present 16200 km to 27000 km proposed.Further reforms to facilitate transparent price discovery and ease of transactions.New EconomyTo take advantage of new technologies:o Policy to enable private sector to build Data Centre parks throughout the country to be brought out soon.o Fibre to the Home (FTTH) connections through Bharatnet to link 100,000 gram panchayats this year.o Rs.6000 crore proposed for Bharatnet programme in 2020-21.Measures proposed to benefit Start-ups:o A digital platform to be promoted to facilitate seamless application and capture of IPRs.o Knowledge Translation Clusters to be set up across different technology sectors including new and emerging areas.o For designing, fabrication and validation of proof of concept, and further scaling up Technology Clusters, harbouring test beds and small scale manufacturing facilities to be established.o Mapping of India’s genetic landscape- Two new national level Science Schemes to be initiated to create a comprehensive database.o Early life funding proposed, including a seed fund to support ideation and development of early stage Start-ups.Rs.8000 crore proposed over five years for National Mission on Quantum Technologies and Applications.Caring SocietyFocus on:o Women & child,o Social Welfare;o Culture and TourismAllocation of Rs. 35,600 crore for nutrition-related programmes proposed for the FY2020-21.Rs.28, 600 crore proposed for women specific programs.Issue about age of a girl entering motherhood - proposed to appoint a task force to present its recommendations in six months’ time.Financial support for wider acceptance of technologies, identified by Ministry of Housing and Urban Affairs to ensure no manual cleaning of sewer systems or septic tanks, to be provided.Rs. 85, 000 crore proposed for 2020-21 for welfare of Scheduled Castes and Other Backward Classes.Rs. 53, 700 crore provided to further development and welfare of Scheduled Tribes.Enhanced allocation of Rs. 9,500 crore provided for 2020-21 for senior citizens and Divyang.Culture & TourismAllocation of Rs. 2500 crore for 2020-21 for tourism promotion.Rs.3150 crore proposed for Ministry of Culture for 2020-21.An Indian Institute of Heritage and Conservation under Ministry of Culture proposed; with the status of a deemed University.5 archaeological sites to be developed as iconic sites with on-site Museums:o Rakhigarhi (Haryana)o Hastinapur (Uttar Pradesh)o Shivsagar (Assam)o Dholavira (Gujarat)o Adichanallur (Tamil Nadu)Re-curation of the Indian Museum in Kolkata, announced by Prime Minister in January 2020.Museum on Numismatics and Trade to be located in the historic Old Mint building in Kolkata.4 more museums from across the country to be taken up for renovation and re-curation.Support for setting up of a Tribal Museum in Ranchi (Jharkhand).Maritime museum to be set up at Lothal- the Harrapan age maritime site near Ahmedabad, by Ministry of Shipping.State governments expected to develop a roadmap for certain identified destinations and formulate financial plans during 2021 against which specified grants to be made available to the States in 2020-21.Environment & Climate ChangeAllocation for this purpose to be Rs.4400 crore for 2020-21.Proposed to advise the utilities to close the running old thermal power plants with carbon emission above the pre-set norms.States that are formulating and implementing plans for ensuring cleaner air in cities above one million to be encouraged.PM launched Coalition for Disaster Resilient Infrastructure (CDRI) with Secretariat in Delhi. Second such international initiative after International Solar Alliance.GovernanceClean, corruption-free, policy driven, good in intent and most importantly trusting in faith.Taxpayer Charter to be enshrined in the Statute will bring fairness and efficiency in tax administration.Companies Act to be amended to build into statues, criminal liability for certain acts that are civil in nature.Other laws with such provisions are to be corrected after examination.Major reforms in recruitment to Non-Gazetted posts in Government and Public sector banks:An independent, professional and specialist National Recruitment Agency (NRA) for conducting a computer-based online Common Eligibility Test for recruitment.A test-centre in every district, particularly in the Aspirational Districts.A robust mechanism to be evolved for appointment including direct recruitment to various Tribunals and specialised bodies to attract best talents and professional experts.Contract Act to be strengthened.New National Policy on Official Statistics to:Promote use of latest technologies including AI.Lay down a road-map towards modernised data collection, integrated information portal and timely dissemination of information.A sum of Rs. 100 crore allocated to begin the preparations for G20 presidency to be hosted in India in the year 2022.Development of North East region:Improved flow of funds using online portal by the Government.Greater access to financial assistance of Multilateral and Bilateral funding agencies.Development of Union Territories of J&K and Ladakh:An amount of Rs. 30,757 crore provided for the financial year 2020-21.o The Union Territory of Ladakh has been provided with Rs. 5,958.Financial SectorReforms accomplished in PSBs :10 banks consolidated into 4.Rs. 3,50,000 crore capital infused.Governance reforms to be carried out to bring in transparency and greater professionalism in PSBs.Few PSBs to be encouraged to approach the capital market to raise additional capitalDeposit Insurance and Credit Guarantee Corporation (DICGC) permitted to increase Deposit Insurance Coverage to Rs. 5 lakh from Rs.1 lakh per depositor.Scheduled Commercial Bank’s health under monitoring through a robust mechanism, keeping depositors’ money safe.Cooperative Banks to be strengthen by amending Banking Regulation Act for:Increasing professionalism.Enabling access to capital.Improving governance and oversight for sound banking through the RBI.NBFCs eligibility limit for debt recovery reduced from:Rs. 500 crore to Rs 100 crore asset size.Rs 1 crore to Rs 50 lakh loan size.Private capital in Banking system:Government to sell its balance holding in IDBI Bank to private, retail and institutional investors through the stock exchange.Easier mobility in jobs:Auto-enrolment in Universal Pension coverage.Inter-operability mechanism to safeguard the accumulated corpus.Pension Fund Regulatory Development Authority of India Act to be amended to:Strengthen regulating role of PFRDAI.Facilitate separation of NPS trust for government employees from PFRDAI.Enable establishment of a Pension Trust by the employees other than Government.Factor Regulation Act 2011 to be amended to:Enable NBFCs to extend invoice financing to the MSMEs through TReDSNew scheme to provide subordinate debt for entrepreneurs of MSMEs by the banksWould be counted as quasi-equity.Would be fully guaranteed through the Credit Guarantee Trust for Medium and Small Entrepreneurs (CGTMSE).The corpus of the CGTMSE would accordingly be augmented by the government.Window for MSME’s debt restructuring by RBI to be extended by one year till March 31, 2021.More than five lakh MSMEs have already been benefitted.An app-based invoice financing loans product for MSMEs to be launched.To prevent the problem of delayed payments and consequential cash flows mismatches.Export promotion of MSMEs:For selected sector such as pharmaceuticals, auto components and others.An Rs 1000 crore scheme anchored by EXIM Bank together with SIDBI.o Hand holding support for technology upgradations, R&D, business strategy etc.Financial MarketDeepening Bond Market.Certain specified categories of Government securities to be opened fully for non -resident investors also.FPI limit in corporate bonds increased to 15% from 9% of its outstanding stock.New legislation to be formulated for laying down a mechanism for netting of financial contracts.Scope of credit default swaps to expand.Debt Based Exchange Traded Fund expanded by a new Debt-ETF consisting primarily of Government Securities.To give attractive access to retail investors, pension funds and long-term investors.A Partial Credit Guarantee scheme for the NBFCs formulated post the Union budget 2019-20 to address their liquidity constraints.New mechanism to be devised to further this.o Government support to securities so floated.Infrastructure FinancingRs.103 lakh crore National Infrastructure Pipeline projects earlier announced.Rs 22,000 crore to cater to the equity support to Infrastructure Finance Companies such as IIFCL and a subsidiary of NIIF.IFSC, GIFT city: full of potential to become a centre of international finance as well as a centre for high end data processing:o An International Bullion exchange(s) to be set up as an additional option for trade by global market participants with the approval of regulator.DisinvestmentGovernment to sell a part of its holding in LIC by way of Initial Public Offer (IPO).Fiscal ManagementXV Finance Commission (FC):o XV Finance Commission has given its first report for FY2020-21o Recommendations accepted in substantial measureo Its final report for five years beginning 2021-22 to be submitted during the latter part of the year.GST Compensation Fund:o Balances due out of collection of the years 2016-17 and 2017-18 to be transferred to the Fund, in two instalments.o Hereinafter, transfers to the fund to be limited only to collection by way of GST compensation cess.Overhaul of Centrally Sponsored Schemes and Central Sector Schemes necessary:o To align them with emerging social and economic needs of tomorrowo To ensure that scarce public resources are spent optimallyOn the recent debate over transparency and credibility of projected fiscal numbers, it is assured that procedure adopted is compliant with the FRBM Act.For the FY 2019-20:o Revised Estimates of Expenditure: at Rs.26.99 lakh croreo Revised Estimates of Receipts: estimated at Rs.19.32 lakh crore.For year 2020-21:o Nominal growth of GDP estimated at 10%.o Receipts: estimated at Rs.22.46 lakh cro Expenditure: at Rs.30.42 lakh cr.Significant tax reforms for boosting investments recently undertaken. However, expected tax buoyancy expected to take time.Fiscal deficit of 3.8% estimated in RE 2019-20 and 3.5% for BE 2020-21. It comprises two ingredients;o 3.3% for year 2019-20 and 3% for the 2020-21 budget estimate.o Deviation of 0.5%, consistent with Section 4(3) of FRBM Act, both for RE 2019-20 and BE 2020-21. (Section 4 (2) of the FRBM Act provides for a trigger mechanism for a deviation from the estimated fiscal deficit on account of structural reforms in the economy with unanticipated fiscal implications.)o Return path, committing to fiscal consolidation without compromising needs of investment out of public funds, is laid in Medium Term Fiscal Policy cum Strategy Statement.o Market borrowings: Net market borrowings: Rs.4.99 lakh crore for 2019-20 and Rs.5.36 lakh crore for 2020-21.A good part of the borrowings for the financial year 2020-21 to go towards Capital expenditure that has been scaled up by more than 21%.Direct TaxDirect Tax Proposals - To stimulate growth, simplify tax structure, bring ease of compliance, and reduce litigations.Personal Income Tax:Significant relief to middle class taxpayers.New and simplified personal income tax regime proposed:Taxable Income Slab (Rs.)Existing tax ratesNew tax rates0-2.5 LakhExemptExempt2.5-5 Lakh5%5%5-7.5 Lakh20%10%7.5-10 Lakh20%15%10-12.5 Lakh30%20%12.5-15 Lakh30%25%Above 15 Lakh30%30%Around 70 of the existing exemptions and deductions (more than 100) to be removed in the new simplified regime.Remaining exemptions and deductions to be reviewed and rationalised in coming years.New tax regime to be optional - an individual may continue to pay tax as per the old regime and avail deductions and exemptions.Measures to pre-fill the income tax return initiated so that an individual who opts for the new regime gets pre-filled income tax returns and would need no assistance from an expert to pay income tax.New regime to entail estimated revenue forgone of Rs. 40,000 crore per year.Corporate Tax:Tax rate of 15% extended to new electricity generation companies.Indian corporate tax rates now amongst the lowest in the world.Dividend Distribution Tax (DDT):DDT removed making India a more attractive investment destination.Deduction to be allowed for dividend received by holding company from its subsidiary.Rs. 25,000 crore estimated annual revenue forgone.Start-ups: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.MSMEs to boost less-cash economy:Turnover threshold for audit increased to Rs. 5 crore from Rs. 1 crore for businesses carrying out less than 5% business transactions in cash.Cooperatives:Parity brought between cooperatives and corporate sector.Option to cooperative societies to be taxed at 22% + 10% surcharge and 4% cess with no exemption/deductions.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 31st March, 2024 with a minimum lock-in period of 3 years by the Sovereign Wealth Fund of foreign governments.Affordable housing:Additional deduction up to Rs. 1.5 lakhs for interest paid on loans taken for an affordable house extended till 31st March, 2021.Date of approval of affordable housing projects for availing tax holiday on profits earned by developers extended till 31st March, 2021.Tax Facilitation MeasuresInstant PAN to be allotted online through Aadhaar.‘Vivad Se Vishwas’ scheme, with a deadline of 30th June, 2020, to reduce litigations in direct taxes:Waiver of interest and penalty - only disputed taxes to be paid for payments till 31st March, 2020.Additional amount to be paid if availed after 31st March, 2020.Benefits to taxpayers in whose cases appeals are pending at any level.Faceless appeals to be enabled by amending the Income Tax Act.For charity institutions:Pre-filling in return through information of donations furnished by the done.Process of registration to be made completely electronic.Unique registration number (URN) to be issued to all new and existing charity institutions.Provisional registration to be allowed for new charity institutions for three years.CBDT to adopt a Taxpayers’ Charter.Losses of merged banks:Amendments proposed to the Income-tax Act to ensure that entities benefit from unabsorbed losses and depreciation of the amalgamating entities.Indirect TaxGST:Cash reward system envisaged to incentivise customers to seek invoice.Simplified return with features like SMS based filing for nil return and improved input tax credit flow to be implemented from 1st April, 2020 as a pilot run.Dynamic QR-code capturing GST parameters proposed for consumer invoices.Electronic invoice to capture critical information in a centralized system to be implemented in a phased manner.Aadhaar based verification of taxpayers being introduced to weed out dummy or non-existent units.GST rate structure being deliberated to address inverted duty structure.Customs Duties:Customs duty raised on footwear to 35% from 25% and on furniture goods to 25% from 20%.Basic customs duty on imports of news print and light-weight coated paper reduced from 10% to 5%.Customs duty rates revised on electric vehicles and parts of mobiles.5% health cess to be imposed on the imports of medical devices, except those exempt from BCD.Lower customs duty on certain inputs and raw materials like fuse, chemicals, and plastics.Higher customs duty on certain goods like auto-parts, chemicals, etc. which are also being made domestically.Trade Policy MeasuresCustoms Act being amended to enable proper checks of imports under FTAs.Rules of Origin requirements to be reviewed for certain sensitive items.Provisions relating to safeguard duties to be strengthened to enable regulating such surge in imports in a systematic way.Provisions for checking dumping of goods and imports of subsidized goods being strengthened.Suggestions for reviews of exemptions from customs duty to be crowd-sourced.Excise duty proposed to be raised on Cigarettes and other tobacco products, no change made in the duty rates of bidis.Anti-dumping duty on PTA abolished to benefit the textile sector.Unprecedented Milestones and Achievements of Indian EconomyIndia now the fifth largest economy of the world.7.4% average growth clocked during 2014-19 with inflation averaging around 4.5%.271 million people raised out of poverty during 2006-16.India’s Foreign Direct Investment elevated to US$ 284 billion during 2014-19 from US$ 190 billion during 2009-14.Central Government debt reduced to 48.7% of GDP (March 2019) from 52.2% (March 2014).Two cross-cutting developments:Proliferation of technologies (Analytics, Machine Learning, robotics, Bio-informatics and Artificial Intelligence).Highest ever number of people in the productive age group (15-65 years) in India.GST removed many bottlenecks in the system.Future Aim for sustaining India’s unique global leadership, driven by Digital RevolutionSeamless delivery of services through Digital Governance.Improvement in physical quality of life through National Infrastructure Pipeline.Risk mitigation through Disaster Resilience.Social security through Pension and Insurance penetration.