2019

## Budget Highlights

 
Expenditure:  The government proposes to spend Rs 27,86,349 crore in 2019-20, which is 13.4% above the revised 
estimate of 2018-19. 
 
Receipts:  The receipts (other than net borrowings) are expected to increase by 14.2% to Rs 20,82,589 crore, owing to 
higher estimated revenue from corporation tax and dividends. 
 
GDP growth:  The government has assumed a nominal GDP growth rate of 12% (i.e., real growth plus inflation) in 
2019-20.  The nominal growth estimate for 2018-19 was 11.5%. 
 
Deficits:  Revenue deficit is targeted at 2.3% of GDP, which is higher than the revised estimate of 2.2% in 2018-19.  
Fiscal deficit is targeted at 3.3% of GDP, lower than the revised estimate of 3.4% in 2018-19.  Note that the government is estimated to breach its budgeted target for fiscal deficit (3.3%) in 2018-19 and the medium term fiscal target of 3.1% in 2019-20. 
 
Ministry allocations:  Among the top 13 ministries with the highest allocations, the highest percentage increase is 
observed in the Ministry of Agriculture and Farmers' Welfare (82.9%), followed by Ministry of Petroleum and Natural Gas (32.1%) and Ministry of Railways (23.4%). 

## Tax Proposals In The Finance Bill

In addition to changes in tax laws, the Finance Bill, 2019 proposes changes in several other laws such as the SEBI Act, The RBI Act, the CGST Act, and the PMLA Act.  These are detailed on **Page 9**. 

 
Surcharge on income tax:  Currently, a surcharge of 15% is levied on the income of individuals earning over one crore 
rupees, and 10% on income of individuals earning between Rs 50 lakh and one crore rupees.  In the Union Budget 2019- 20, the surcharge on income tax for individuals earning between two crore rupees and five crore rupees has been increased to 25% and for persons earning over five crore rupees has been increased to 37%. 
 
Corporation tax:  Currently, companies with annual turnover of less than Rs 250 crore pay corporate income tax at the 
rate of 25%.  This threshold has been increased to Rs 400 crore.  
 
Tax on cash withdrawals:  A TDS of 2% will be levied by financial companies and post offices on individuals for cash 
withdrawals exceeding one crore rupees in a year from a bank account.  
 
Tax exemption for affordable housing:  An additional tax deduction of up to Rs 1,50,000 will be provided on interest 
paid on loans for self-occupied house owners.  The conditions for availing this deduction are: (i) the loan must be sanctioned in FY 2019-20, (ii) the stamp duty on the house should not exceed Rs 45 lakh rupees, and (iii) the individual should not own another residential house property as of the date of the home loan.  
 
Tax exemptions for electric vehicles:  A tax deduction of up to Rs 1,50,000 will be provided on interest paid on loans 
to purchase an electric vehicle.  This deduction will be applicable for loans sanctioned between FY 2019-20 and FY 2022-23.  
 
Road and infrastructure cess:  The Road and Infrastructure Cess on petrol and high-speed diesel has been increased by 
one rupee per litre.  Excise duty has also been increased by one rupee per litre for these products. 
 
Customs duty:  The customs duty on gold and precious metals will be increased from 10% to 12.5%.   

## Policy Highlights

 
Banking and Finance:  The government plans to partially guarantee (for first 10% of loss) Public Sector Banks for 
funds provided in a pooled manner to NBFCs.  Further, Rs 70,000 crore will be provided for recapitalisation of Public Sector Banks.  
 
Government borrowings:  Currently, the gross borrowing programme of the government is funded entirely through 
domestic borrowings.  The government plans to raise a part of its borrowings abroad in foreign currency. 
 
Infrastructure:  The central government will invest Rs 100 lakh crore in infrastructure over the next five years.  Phase 
II of the Bharatmala project will be launched under which state highways will be developed.  Public private partnerships will be leveraged for railways to attract an investment of Rs 50 lakh crore during the period 2018-30.  A blue print will be made for developing gas-grids, water-grids, i-ways (communication networks) and regional airports on the lines of the One Nation–One Grid for power.  Structural reforms in the power sector (including tariff) will be announced.  
 
Industry:  The minimum public shareholding in listed companies will be increased from 25% to 35%.  A new electronic 
fund raising platform will be created for listing social enterprises and voluntary organisations.  The present policy of 
51% stake of government in non-financial PSUs will be modified to include stake of government controlled institutions.   
 
Investments:  100% Foreign Direct Investment (FDI) will be permitted for insurance intermediaries.  Local sourcing 
norms will be eased for FDI in the single brand retail sector.  Further, relaxing of the FDI norms in aviation, media and insurance sectors will be examined.  Statutory limit for Foreign Portfolio Investment will be increased from the current 
24% to sectoral limits.  Foreign shareholding limits in PSUs will be increased to the maximum permissible sectoral limit.  
 
Agriculture and allied activities:  Pradhan Mantri Matsya Sampada Yojana has been proposed to address infrastructure 
gaps in the fisheries sector.  10,000 new Farmer Producer Organisations will be setup over the next five years.  The central government will work towards adoption of zero-budget farming.   
 
Rural Development:  Under the Pradhan Mantri Gram Sadak Yojana, 1.25 lakh km of road will be upgraded at an 
estimated cost of Rs 80,250 crore in the next five years.  100 new clusters will be setup under the Scheme of Fund for Upgradation and Regeneration of Traditional Industries (SFURTI).  All rural households will be provided with piped water supply by 2024 under the Jal Jeevan Mission.  Swachh Bharat Mission will be expanded to undertake solid waste management in every village.  
 
Social Justice:  An overdraft of Rs 5,000 will be provided to women self-help group (SHG) members who hold Jan-
Dhan accounts.  Further, a loan up to one lakh rupees will be provided under the MUDRA scheme to one woman in every SHG.  
 
Social Security:  A new pension benefit scheme, namely Pradhan Mantri Karam Yogi Maandhan Scheme, has been 
announced for traders and small shopkeepers with annual turnover of less than Rs 1.5 crore.  
 
Education:  The new National Education Policy will be introduced.  The National Research Foundation will be setup to 
promote funding and coordinate research in the country.  A Study in India programme will be launched to encourage foreign students in higher education.   
 
Legislative Framework:  To promote rental housing, a model tenancy law will be finalised and circulated.  The Higher 
Education Commission of India Bill will be introduced.  Different multiple labour laws will be streamlined into a set of four labour codes.  

## Budget Estimates Of 2019-20 As Compared To Revised Estimates Of 2018-19

 
Total Expenditure:  The government is estimated to spend Rs 27,86,349 crore during 2019-20.  This is 13.4% more the 
revised estimate of 2018-19.  Out of the total expenditure, revenue expenditure is estimated to be Rs 24,47,780 crore (14.3% growth) and capital expenditure is estimated to be Rs 3,38,569 crore (6.9% growth). 
 
Total Receipts:  The government receipts (excluding borrowings) are estimated to be Rs 20,82,589 crore, an increase of 
14.2% over the revised estimates of 2018-19.  The gap between these receipts and the expenditure will be plugged by 
borrowings, budgeted to be Rs 7,03,760 crore, an increase of 10.9% over the revised estimate of 2018-19. 
 
Transfer to states:  The central government will transfer Rs 13,29,428 crore to states and union territories in 2019-20.  
This is an increase of 6.6% over the revised estimates of 2018-19 and includes devolution of (i) Rs 8,09,133 crore to states, out of the centre's share of taxes, and (ii) Rs 5,20,295 crore in the form of grants and loans. 
 
Deficits:  Revenue deficit is targeted at 2.3% of GDP, and fiscal deficit is targeted at 3.3% of GDP in 2019-20.  The target 
for primary deficit (which is fiscal deficit excluding interest payments) is 0.2% of GDP. 
 
GDP growth estimate:  The nominal GDP is estimated to grow at a rate of 12% in 2019-20.  The estimated nominal GDP 
growth rate for 2018-19 is 11.5%. 

% change 
Budgeted 
(RE 2018-19 to BE 
  
Actuals 2017-18 
2018-19 
Revised 
2018-19 
Budgeted 
2019-20 
2019-20) 
Revenue Expenditure 
18,78,833  
 21,41,772  
 21,40,612  
 24,47,780  
14.3% 
Capital Expenditure 
2,63,140  
 3,00,441  
 3,16,623  
 3,38,569  
6.9% 
Total Expenditure 
21,41,973  
 24,42,213  
 24,57,235  
 27,86,349  
13.4% 
Revenue Receipts 
14,35,233  
 17,25,738  
 17,29,682  
 19,62,761  
13.5% 
Capital Receipts 
 1,15,678  
 92,199  
 93,155  
 1,19,828  
28.6% 
of which: 

 
   Recoveries of Loans 
 15,633  
 12,199  
 13,155  
 14,828  
12.7% 
   Other receipts (including disinvestments) 
 1,00,045  
 80,000  
 80,000  
 1,05,000  
31.3% 
Total Receipts (without borrowings) 
15,50,911  
 18,17,937  
 18,22,837  
 20,82,589  
14.2% 
Revenue Deficit 
 4,43,600  
 4,16,034  
 4,10,930  
 4,85,019  
18.0% 
% of GDP 
2.6 
2.2 
2.2 
2.3 
  
Fiscal Deficit 
 5,91,062  
 6,24,276  
 6,34,398  
 7,03,760  
10.9% 
% of GDP 
3.5 
3.3 
3.4 
3.3 
  
Primary Deficit 
 62,110  
 48,481  
 46,828  
 43,289  
-7.6% 
% of GDP 
0.4 
0.3 
0.2 
0.2 
  

Note:  Budgeted estimates (BE) are budget allocations announced at the beginning of each financial year.  Revised Estimates (RE) are estimates of projected amounts of receipts and expenditure until the end of the financial year.  Actual amounts are audited accounts of expenditure and receipts in a year. Sources:  Budget at a Glance, Union Budget Documents 2019-20; PRS. 

 
Expenses which bring a change to the government's assets or liabilities (such as construction of roads or recovery of loans) 
are capital expenses, and all other expenses are revenue expenses (such as payment of salaries or interest payments). 
 
In 2019-20, **capital expenditure** is expected to increase by 6.9% over the revised estimates of 2018-19, to Rs 3,38,569 crore.  On the other hand, **revenue expenditure** is 
expected to increase by 14.3% over the revised estimates of 2018-19 to Rs 24,47,780 crore. 
 
From 2009-10 to 2019-20, capital expenditure had an annual average growth of 11.6%, while revenue expenditure had an annual average growth of 10.4%. 
 
Disinvestment is the government selling its stakes 
in Public Sector Undertakings (PSUs).  In 2018-19, the government is estimated to meet its disinvestment target.  The disinvestment target for 2019-20 has been set at Rs 1,05,000 crore. 
Note:  Figures for 2018-19 are revised estimates. 

## Receipts Highlights For 2019-20

 
Total receipts (including borrowings) in 2019-20 are estimated to be Rs 27,86,349 crore and net receipts (excluding 
borrowings) to be Rs 20,82,589 crore.  Receipts (without borrowings) are estimated to increase by 14.2% over the revised estimates of 2018-19. 
 
Gross tax revenue is budgeted to increase by 9.5% over the revised estimates of 2018-19, which is lower than the estimated 
nominal GDP growth of 12% in 2019-20.  The net tax revenue of the central government (excluding state's share in taxes) is 
estimated to be Rs 16,49,582 crore. 
 
Non-tax revenue is expected to be Rs 3,13,179 crore in 2019-20.  This is 27.7% higher than the revised estimate of 2018-19. 
 
Capital receipts (without borrowings) are budgeted to increase by 28.6% over the revised estimates of 2018-19.  This is on 
account of disinvestments, which are expected to be Rs 1,05,000 crore in 2019-20, as compared to Rs 80,000 crore as per the revised estimates of 2018-19. 

% change 
(RE 2018-19 to BE 
  
Actuals 
2017-18 
Budgeted 
2018-19 
Revised 
2018-19 
Budgeted 
2019-20 
2019-20) 
Gross Tax Revenue 
19,19,009 
22,71,242 
22,48,175 
   24,61,195  
9.5% 
of which: 
 
  
 
  
 
Corporation Tax 
5,71,202 
6,21,000 
6,71,000 
     7,66,000  
14.2% 
Taxes on Income 
4,30,772 
5,29,000 
5,29,000 
     5,69,000  
7.6% 
Goods and Services Tax 
4,42,562 
7,43,900 
6,43,900 
     6,63,343  
3.0% 
Customs 
1,29,030 
1,12,500 
1,30,038 
     1,55,904  
19.9% 
Union Excise Duties 
2,59,431 
2,59,600 
2,59,612 
     3,00,000  
15.6% 
Service Tax 
81,228 
- 
9,283 
- 
- 
A. Centre's Net Tax Revenue 
12,42,488 
14,80,649 
14,84,406 
   16,49,582  
11.4% 
B. Non Tax Revenue 
1,92,745 
2,45,089 
2,45,276 
     3,13,179  
27.7% 
of which: 
 
  
 
  
 
Interest Receipts 
13,574 
15,162 
12,047 
13,711 
13.8% 
Dividend and Profits 
91,361 
1,07,312 
1,19,264 
     1,63,528  
37.1% 
Other Non-Tax Revenue 
87,810 
1,22,615 
1,13,965 
1,35,940 
19.3% 
C. Capital Receipts (without borrowings) 
1,15,678 
92,199 
93,155 
     1,19,828  
28.6% 
of which: 
 
  
 
  
 
Disinvestment 
1,00,045 
80,000 
80,000 
     1,05,000  
31.3% 
Receipts (without borrowings) (A+B+C) 
15,50,911 
18,17,937 
18,22,837 
20,82,589 
14.2% 
Borrowings 
5,91,062 
6,24,276 
6,34,398 
7,03,760 
10.9% 
Total Receipts (including borrowings) 
21,41,973 
24,42,213 
24,57,235 
27,86,349 
13.4% 

Note:  Centre's net tax revenue is gross tax revenue less share of states in central taxes (Rs 8,09,133 crore in 2019-20).  Figures for GST include receipts from the GST compensation cess.  Note that GST was levied for a nine-month period during the year 2017-18, starting July 2017.  Service tax in 2018-19 RE relates to residual and arrear payments. Sources:  Receipts Budget, Union Budget Documents 2019-20; PRS. 

 
Indirect tax:  The total indirect tax collections are estimated to be Rs 11,19,247 crore in 2019-20.  Of this, the 
government has estimated to raise Rs 6,63,343 crore from GST.  Out of the total tax collections under GST, 79% is expected to come from central GST (Rs 5,26,000 crore), 4% from the integrated GST (Rs 28,000 crore), and 16% (Rs 1,09,343 crore) from the GST compensation cess.  Note that, in the interim budget 2019-20, the tax collections under GST for 2019-20 were estimated to be Rs 7,61,200 crore.   
 
Direct tax:  The collections from taxes on companies is expected to increase by 14.2% in 2019-20 over the revised 
estimate of the previous year, and those on individuals by 7.6%.  These collections are estimated to be Rs 7,66,000 crore and Rs 5,69,000 crore respectively.  The revised estimates of 2018-19 indicate a 23% increase in collections from personal income tax over 2017-18.   
 
Growth in non-tax receipts:  Non-tax revenue consists of interest receipts on loans given by the centre, dividends and 
profits, external grants, and receipts from general, economic, and social services, among others.  Non-tax revenue is expected 
to increase by 27.7% over the revised estimates of 2018-19 to Rs 3,13,179 crore.  
 
Disinvestment target:  The disinvestment target for 2019-20 is Rs 1,05,000 crore.  This target is 31.3% higher than the 
revised estimate of 2018-19 (Rs 80,000 crore).  Note that, the government had set a disinvestment target of Rs 90,000 crore for the year 2019-20 in the interim budget of 2019-20.   
 

## Expenditure Highlights For 2019-20

 
Total expenditure in 2019-20 is expected to be Rs 27,86,349 crore, which is 13.4% higher than the revised estimate of 
2018-19.  Out of this, (i) Rs 8,70,794 crore is proposed to be spent on central sector schemes (18.2% increase over the revised estimate of 2018-19), and (ii) Rs 3,31,610 crore is proposed to be spent on centrally sponsored schemes (8.8% increase over the revised estimate of 2018-19). 
 
The government is expected to spend Rs 1,74,300 crore on pensions in 2019-20, which is 4.6% higher than the revised 
estimate of 2018-19.  In addition, expenditure on interest payments in 2019-20 is expected to be Rs 6,60,471 crore.   

% change 
(RE 2018-19 to BE 
  
Actuals 
2017-18 
Budgeted 
2018-19 
Revised 
2018-19 
Budgeted 
2019-20 
2019-20) 
Central Expenditure 

 
 
Establishment Expenditure of Centre 
 4,73,031  
 5,08,400  
 5,17,025  
 5,46,296  
5.7% 
Central Sector Schemes 
 5,87,785  
 7,08,934  
 7,36,796  
 8,70,794  
18.2% 
Other expenditure 
 6,22,898  
 6,78,017  
 6,95,609  
 7,72,129  
11.0% 
Centrally Sponsored Schemes and other transfers 


Centrally Sponsored Schemes 
 2,85,448  
 3,05,517  
 3,04,849  
 3,31,610  
8.8% 
Finance Commission Grants 
 92,244  
 1,09,374  
 1,06,129  
 1,20,466  
13.5% 
of which: 


Rural Local Bodies 
 34,448  
 45,069  
 42,815  
 52,558  
22.8% 
Urban Local Bodies 
 12,594  
 19,870  
 18,879  
 23,359  
23.7% 
Grants-in-aid 
 9,383  
 9,852  
 9,852  
 10,344  
5.0% 
Post Devolution Revenue Deficit Grants 
 35,819  
 34,582  
 34,582  
 34,206  
-1.1% 
Other grants 
 80,567  
 1,31,973  
 96,827  
 1,45,054  
49.8% 
Total Expenditure 
21,41,973  
   24,42,213  
      24,57,235  
  27,86,349  
13.4% 

Sources:  Budget at a Glance, Union Budget Documents 2019-20; PRS. 

## Expenditure On Subsidies

In 2019-20, the total expenditure on subsidies is estimated to increase to Rs 3,38,949 crore (13.3%) over the revised estimate of 2018-19.  This is owing to an increase in expenditure on petroleum, fertiliser, food, and other interest subsidies.  Details are given below: 

 
Food subsidy:  Allocation for food subsidy is estimated at Rs 1,84,220 crore in 2019-20, a 7.5% increase as compared to 
the revised estimate of 2018-19.  In 2018-19 budget, Rs 1,69,323 crore was allocated for food subsidy, however, the revised estimate is higher than the budgeted estimate by Rs 1,975 crore.  The revised estimate for 2018-19 is 71% higher 
than the expenditure on food subsidy in 2017-18. 
 
Fertiliser subsidy:  Expenditure on fertiliser subsidy is estimated at Rs 79,996 crore in 2019-20.  This is estimated to 
increase by Rs 9,910 crore (14.1%) over revised estimate of 2018-19.  Allocation to the subsidy in 2019-20 budget is Rs 5,010 crore higher than the allocation made in 2019-20 interim budget. 
 
Petroleum subsidy:  Expenditure on petroleum subsidy is estimated to increase by Rs 12,645 crore (50.9%) in 2019-20.  
Petroleum subsidy consists of subsidy on LPG (Rs 32,989 crore) and kerosene subsidy (Rs 4,489 crore).  The increase in allocation in 2019-20 is owing to an increase in LPG subsidy of Rs 12,706 crore (62.6%) from 2018-19 revised estimates. 
 
Other subsidies:  Expenditure on other subsidies includes interest subsidies for various government schemes, subsidies 
for the price support scheme for agricultural produce, import of pulses, and assistance to state agencies for procurement, among others.  In 2019-20, the expenditure on these other subsidies has increased by Rs 4,251 crore (12.9%) over the revised estimate of 2018-19.  Table 4 provides details of subsidies in 2019-20. 

% change 
  
Actuals 
2017-18 
Budgeted 
2018-19 
Revised 
2018-19 
Budgeted 
2019-20 
(RE 2018-19 to BE 2019-20) 
Food subsidy 
1,00,282 
1,69,323 
1,71,298 
1,84,220 
7.5% 
Fertiliser subsidy 
66,468 
70,090 
70,086 
79,996 
14.1% 
Petroleum subsidy 
24,460 
24,933 
24,833 
37,478 
50.9% 
Other subsidies 
33,245 
31,161 
33,004 
37,255 
12.9% 
Total 
2,24,455 
2,95,507 
2,99,221 
3,38,949 
13.3% 

Sources: Expenditure Profile, Union Budget 2019-20; PRS. 
 

## Expenditure By Ministries

The ministries with the 13 highest allocations account for 55% of the estimated total expenditure in 2019-20.  Of these, the Ministry of Defence has the highest allocation in 2019-20, at Rs 4,31,011 crore (including pensions).  It accounts for 15% of the total budgeted expenditure of the central government.  Other Ministries with high allocations include: (i) Ministry of Consumer Affairs, Food and Public Distribution, (ii) Agriculture and Farmers' Welfare, (iii) Rural Development, (iv) Home Affairs, and (v) Human Resource Development.  Table 5 shows the expenditure on Ministries with the 13 highest allocations for 2019-20 and the changes in allocation as compared to the revised estimate of 2018-19. 

% change 
  
Actuals 
2017-18 
Budgeted 
2018-19 
Revised 
2018-19 
Budgeted 
2019-20 
(RE 2018-19 to BE 2019-20) 
Defence 
3,79,702 
4,04,365 
4,05,194 
4,31,011 
6.4% 
Consumer Affairs, Food and Public Distribution 
1,09,578 
1,75,944 
1,79,655 
1,94,513 
8.3% 
Agriculture and Farmers' Welfare 
44,340 
54,500 
75,753 
1,38,564 
82.9% 
Rural Development 
1,10,333 
1,14,915 
1,14,400 
1,19,874 
4.8% 
Home Affairs 
1,01,763 
1,07,573 
1,13,167 
1,19,025 
5.2% 
Human Resource Development 
80,215 
85,010 
83,626 
94,854 
13.4% 
Road Transport and Highways 
61,015 
71,000 
78,626 
83,016 
5.6% 
Chemicals and Fertilisers  
67,158 
70,587 
70,684 
80,534 
13.9% 
Railways 
45,231 
55,088 
55,135 
68,019 
23.4% 
Health and Family Welfare 
53,114 
54,600 
56,045 
64,559 
15.2% 
Housing and Urban Affairs 
40,061 
41,765 
42,965 
48,032 
11.8% 
Petroleum and Natural Gas 
33,192 
31,101 
32,465 
42,901 
32.1% 
Communications 
36,979 
39,551 
32,654 
38,637 
18.3% 
Other Ministries 
9,79,292 
11,36,214 
11,16,867 
12,62,810 
13.1% 
Total Expenditure 
21,41,973 
24,42,213 
24,57,235 
27,86,349 
13.4% 

Note:  Expenditure is net of recoveries such as fines, and ticket sales. Sources:  Expenditure Budget, Union Budget 2019-20; PRS. 

 
Ministry of Agriculture and Farmers' Welfare:  The Ministry of Agriculture and Farmers' Welfare has seen the 
highest increase in allocation for 2019-20 over the revised estimate of 2018-19.  Its allocation is set to increase from Rs 75,753 crore as per the revised estimate of 2018-19, to Rs 1,38,564 crore in 2019-20 (82.9% increase).  This is primarily on account of the Income Support Scheme (PM-KISAN) which was announced in the 2019-20 interim budget.  Rs 75,000 crore has been allocated towards the scheme in 2019-20 and Rs 20,000 crore in the revised estimate of 2018-19. 
 
Ministry of Consumer Affairs, Food and Public Distribution:  The allocation for the Ministry of Consumer Affairs, 
Food and Public Distribution increased by Rs 14,857 crore (8.3%) over the revised estimate of 2018-19 to Rs 1,94,513 crore in 2019-20.  This is primarily on account of an increase in the expenditure on food subsidy by Rs 12,922 crore. 
 
Ministry of Railways:  Allocation to the Ministry of Railways has increased by Rs 12,884 crore (23.4%) in 2019-20, 
over the revised estimate of 2018-19.  This is mainly on account of an increase in the expenditure on railways' staff and 
fuel cost. 

## Expenditure On Major Schemes

% change 
  
Actuals 
2017-18 
Budgeted 
2018-19 
Revised 
2018-19 
Budgeted 
2019-20 
(RE 2018-19 to BE 2019-20) 
PM-KISAN 
- 
- 
20,000 
75,000 
275.0% 
MGNREGS 
55,166 
55,000 
61,084 
60,000 
-1.8% 
National Education Mission 
29,455 
32,613 
32,334 
38,547 
19.2% 
National Health Mission 
32,000 
30,634 
31,187 
33,651 
7.9% 
Integrated Child Development Services 
19,234 
23,088 
23,357 
27,584 
18.1% 
Pradhan Mantri Awas Yojana (rural + urban) 
31,164 
27,505 
26,405 
25,853 
-2.1% 
Pradhan Mantri Gram Sadak Yojana 
16,862 
19,000 
15,500 
19,000 
22.6% 
Pradhan Mantri Fasal Bima Yojana 
9,419 
13,000 
12,976 
14,000 
7.9% 
AMRUT and Smart Cities Mission 
9,463 
12,169 
12,569 
13,750 
9.4% 
Swachh Bharat Mission (rural + urban) 
19,427 
17,843 
16,978 
12,644 
-25.5% 
Green Revolution 
11,057 
13,909 
11,802 
12,561 
6.4% 
Mid-Day Meal Programme 
9,092 
10,500 
9,949 
11,000 
10.6% 
National Rural Drinking Water Mission 
7,038 
7,000 
5,500 
10,001 
81.8% 
National Livelihood Mission 
4,926 
6,060 
6,294 
9,774 
55.3% 
Pradhan Mantri Krishi Sinchai Yojana 
6,613 
9,429 
8,251 
9,682 
17.3% 

  Sources: Expenditure Profile, Union Budget 2019-20; PRS.   

 
Among schemes, PM-KISAN (income support to farmers) has the highest allocation in 2019-20 of Rs 75,000 crore. 
 
The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) has the second highest allocation in 
2019-20 of Rs 60,000 crore.  This is a decrease of Rs 1,084 crore (1.8%) from the revised estimate of 2018-19. 
 
Other schemes with high allocations for 2019-20 include National Education Mission (an increase of 19.2%), National Health Mission (an increase of 7.9%), and Integrated Child Development Services (an increase of 18.1%). 
 
Allocation to the National Rural Drinking Water Mission has increased by 81.8% over the revised estimate of 2018-19.  
The allocation for this year is Rs 10,001 crore, as compared to Rs 5,500 crore in 2018-19 (revised estimate).  Allocation to National Livelihood Mission has increased by Rs 3,481 crore (55.3%) over the revised estimates of 2018-19. 
 
Allocation to the Swachh Bharat Mission has decreased by 25.5% over the revised estimate of 2018-19.  The allocation for this year is Rs 12,644 crore, as compared to Rs 16,978 crore in 2018-19 (revised estimate).  The rural and urban components of Swachh Bharat Mission have been allocated Rs 9,994 crore and Rs 2,650 crore in 2019-20, respectively. Allocation to Swachh Bharat Mission (Rural) has decreased by 31% in 2019-20 over the revised estimate of 2018-19. 

## Expenditure On Scheduled Caste And Scheduled Tribe Sub-Plans And Schemes For Welfare Of Women, Children And Ner Table 7:  Allocations For Women, Children, Scs, Sts And Ner (Rs Crore)

% change 
  
Budgeted 
2018-19 
Revised 
2018-19 
Budgeted 
2019-20 
(RE 2018-19 to 
BE 2019-20) 
Welfare  of Women 
1,24,429 
1,25,532 
1,36,934 
9.1% 

 
Programmes for the welfare of women and children have been allocated Rs 2,28,578 crore in 2019-20, an increase of 10.5% over the revised estimate of 2019- 20.  These allocations include programmes under all the ministries.   

| Welfare of Children        | 79,090    | 81,236    | 91,644    | 12.8%    |
|----------------------------|-----------|-----------|-----------|----------|
| Scheduled Castes           | 56,619    | 62,474    | 81,341    | 30.2%    |
| Scheduled Tribes           | 39,135    | 41,093    | 52,885    | 28.7%    |
| North Eastern Region (NER) | 47,995    | 47,088    | 59,370    | 26.1%    |

 
The sub-plans for Scheduled Castes and Scheduled Tribes have been allocated a total of Rs 1,34,226 crore in 2019-20, a 29.6% increase over the revised estimate of 2018-19. 
Sources: Expenditure Profile, Union Budget 2019-20; PRS. 

## Fiscal Responsibility And Budget Management Targets

The Fiscal Responsibility and Budget Management (FRBM) Act, 2003 requires the central government to progressively reduce its outstanding debt, revenue deficit and fiscal deficit.  The central government gives three year rolling targets for these indicators when it presents the Union Budget each year.  Table 8 shows the targets for revenue deficit and fiscal deficits as given in the Medium Term Fiscal Deficit Policy Statement. 

Fiscal deficit is an indicator of borrowings by the government for financing its expenditures.  The estimated fiscal deficit for 2019-20 is 3.3% of GDP. 

  
Actuals 
2017-18 
Fiscal Deficit 
3.5% 
3.4% 
3.3% 
3.0% 
3.0% 
Revenue Deficit 
2.6% 
2.2% 
2.3% 
1.9% 
1.7% 

Sources: Medium Term Fiscal Policy Statement, Union Budget 2019-20; PRS. 

Revenue deficit is the excess of revenue expenditure over revenue receipts.  Such a deficit implies the government's need to borrow funds to meet expenses which may not provide future returns.  The estimated revenue deficit for 2019-20 is 2.3% of GDP. 

Primary deficit is the difference between the fiscal deficit and interest payments.  The estimated primary deficit for 2019-20 
is 0.2% of GDP. 

Sources: Medium Term Fiscal Policy Statement, Union Budget (multiple years); PRS.   

 
Over the past 15 years, the government has largely been able to keep the deficits below budgeted levels.  In 2018-19, the government is expected to breach its budgeted target of fiscal deficit of 3.3% of GDP, as the fiscal deficit is expected to be 3.4%.  Under the FRBM Act, 2003, the three-year target (2021-22) for fiscal and revenue deficits have been set at 3% and 1.5%, respectively. 
 
In 2018-19, the government had set a budget estimate of 
3.3% for fiscal deficit, and 2.2% for revenue deficit.  As per revised estimates, fiscal deficit has slightly exceeded the 2018-19 budget target. 
 
Outstanding debt is the accumulation of borrowings over the years.  A higher debt implies that the government has a higher loan repayment obligation over the years. 
 
Total outstanding liabilities of the government have decreased from 55.5% of the GDP in 2000-01 to 48.4% in 2018-19 (revised estimates).  In 2019-20, the outstanding debt is expected to be at 48% of GDP.  The FRBM Act sets a target of 40% debt to GDP to be met by 2024-25. 
 

Revised 
2018-19 
Budgeted 
2019-20 
Target 
2020-21 
Target 
2021-22 
Total outstanding liability (% of GDP)

Note: Figures for 2018-19 are revised estimates and for 2019-20 are budget estimates.  Sources: Economic Surveys 2003-04 to 2017-18; Union Budget 2019-20; PRS. 

## Major Legislative Changes Proposed In The Finance Bill

 
Dispute resolution scheme:  A dispute resolution cum amnesty scheme called the Sabka Vishwas Legacy Dispute 
Resolution Scheme is being introduced for resolution and settlement of legacy cases pending under various Acts, including the Central Excise Tax, 1944, and the Sugar Cess Act, 1982.    
 
Central Goods and Services Tax Act, 2017:  Under the Act, an applicant can apply for an advance ruling from an 
Authority constituted under various GST laws of various state or union territories.  An advance ruling can be sought to 
clarify certain matters, such as the determination of GST liability.  The National Authority may decide appeals against conflicting advance rulings on the same question by Authorities of two or more states or union territories.  The Bill provides for the qualification, term, and conditions of services of the National Authority.  
 
Reserve Bank of India Act, 1934:  Under the Act, RBI may set a minimum net worth requirement for NBFCs between 
Rs 25 lakh and two crore rupees.  The amendment allows RBI to set the minimum requirement up to Rs 100 crore.   
 
The Act is being amended to enable the RBI to take several measures in relation to the management of NBFCs.  These include: 
 
Framing schemes for resolution:  The Act is being amended to allow the RBI to frame schemes for the resolution of NBFCs.  These include schemes for: (i) amalgamation of two NBFCs, (ii) reconstruction of the NBFC, or (iii) splitting the NBFC to preserve the continuity of those activities of the NBFC which are critical to the functioning of the financial system.  As a part of these schemes, the RBI may reduce the pay or cancel the shares of the senior management of the NBFC, without any compensation for the loss.   
 
Scrutiny of group companies:  The Act is being amended to enable RBI to: (i) direct the NBFC to attach to its financial statements, any information on the business of its group companies, or (ii) direct an inspection or audit of the group company.  Group companies of the NBFC will include its subsidiaries, associates, and joint venture companies.    
 
Supersession of Board of Directors:  The Act is being amended to provide for supersession of the Board of Directors of the NBFC for a period of five years.  In the interim period, the central government may appoint an administrator to carry out the functions of the Board of Directors.  
 
Removal of directors:  The RBI may remove any director of a non-government NBFC and replace him with a temporary director for a period of three years.    
 
Penalties:  Penalties for certain offences has been increased.  For example, failure to furnish information under the Act is punishable with Rs 2,000.  This has been increased to Rs 1,00,000.  Further, the penalty for an auditor for failing to comply with the directions of the RBI has been increased from Rs 5,000 to Rs 10,00,000.   
 
National Housing Bank Act, 1987:  The Act regulates the functioning of housing finance institutions through the 
National Housing Board.  The amendments being made include: 
 
To register as a housing finance institution, a company must have a net-owned fund of 25 lakh rupees, or higher notified amount.  This threshold is being increases to 10 crores or more.   
 
An application for registration as a household finance institution is to be made to the National Housing Bank.  This is being amended to state that all applications will be made to the RBI.  Further, all pending applications with National Housing Board are to be transferred to RBI.  
 
Under the Act, processes relating to registration, including consideration, grant, and cancellation of applications are to be carried out by the National Housing Board.  The Act is being amended to transfer these to the RBI.         
 
The Act provides the National Housing Bank with various powers such as: (i) specifying the percentage of assets a housing finance institution must invest in securities in India, (ii) require housing finance institutions to maintain an account with a Scheduled Bank or the National Housing Board, and (iii) requiring them to file returns.  This is being amended to transfer these powers to the RBI. 
 
Insurance Act, 1938:  The Act is being amended to require net owned funds of at least Rs 1,000 crore for registration of 
foreign insurers engaged in re-insurance business and operating in an International Financial Services Centre (set up in Special Economic Zones).   
 
Securities Contract (Regulation) Act, Securities, 1956 (SCRA):  The Act imposes penalties on entities who fail to 
furnish information required under law to a stock exchange or furnish incorrect information to the stock exchange.  These penalties range from one lakh rupees to one crore rupees.  The Act is being amended to extend the penalty for failure to furnish this information to the SEBI in addition to the stock exchange. 
 
Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970; Banking Companies (Acquisition and 
Transfer of Undertakings) Act, 1970:  The Act nationalised banks such as the Central Bank of India, Punjab National 
Bank, and Corporation Bank.  Under the Act, the Board of Directors of the bank will include four whole time directors, appointed by the central government in consultation with the RBI.  The Act is being amended to increase the number of directors from four to five.   
 
General Insurance Business (Nationalisation) Act, 1972:  The Act nationalised Indian insurance companies and 
reorganised them into four insurance companies (excluding the General Insurance Corporation).  The Act is being 
amended to enable reduction in the number of such companies. 
 
Prohibition of Benami Property Transactions Act, 1988:  The Act is being amended to increase penalties under the 
Act.  In addition to existing penalties, any person who fails to comply with summons or furnishes false information will be liable to pay Rs 25,000 for each such failure.   Further, under the Act, prior sanction is required for prosecution of 
certain offences under the Act from the CBDT.  The sanctioning authority has been changed to Commissioner, Director, 
Principle Commissioner, or Principle Director of Income Tax.    
 
Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015:  The Finance Bill changes 
the definition of 'assessee' in the 2015 Act.  Currently, the Act applies to a resident of India.  The Bill amends this to make the Act applicable to both Indian residents and non-residents as defined under the Income Tax Act.   
 
Payment and Settlement Systems Act, 2007:  The Bill is being amended to prohibit any bank or payments system 
provider from charging customers for the use of electric modes of payment (prescribed under Income-tax Act, 1961). 
 
Prevention of Money Laundering Act, 2002:  The Bill is being amended to increase the responsibilities of reporting 
entities (such as, banks and other financial institutions).  These entities will be additionally required to authenticate identities of their clients, the source of their funds, and the nature of relationship between the transacting parties.  Data obtained while verifying transactions must be kept for five years.  Further, the amendments seek to allow the government to notify an Inter-Ministerial Coordination Committee for inter-departmental and inter-agency co-ordination. The purpose of this committee will include the development and implementation of policies on anti-money laundering or countering the financing of terrorism.  
 
Central Road and Infrastructure Fund Act, 2000:  Currently, the central government is responsible for formulating 
criteria on the basis of which specific projects of state roads are financed out of states' share of funds.  The central government will now be responsible for formulating criteria for any state road projects. 
 
Securities and Exchange Board of India Act, 1992:  The Act is being amended to add capital expenditure to the list of 
expenses incurred by the General Fund maintained by SEBI.  Additionally, the Bill amends the Act to constitute a Reserve Fund which will be credited with 25% of the annual surplus of the General Fund.  Further, the amendment adds penalties for concealment, destruction, or falsification of records, or access to unauthorised information.  The penalties may range from one lakh rupees to up to ten crore rupees or three times the amount of profits made from the act, whichever is higher.  
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2019