Highlights: Union Budget 2020-21 | Indian Economy for UPSC CSE PDF Download

 Page 1


Prominent Themes of the Budget
Ease of 
Governance
Financial 
Aspirational Economic 
Caring Society
Living
Governance
sector
sp a o a
India
Agriculture, Irrig
ation and Rural 
Development
co o c
Development
Industry, Comm
erce and 
Investment
Caring Society
Women & 
Child, Social 
Welfare
Wellness, Water 
and Sanitation
Infrastructure
Culture and 
Tourism
Education and 
Skills
New Economy
Environment and 
Climate Change
GOVERNANCE
IBC
• Honourable 
exit through 
IBC for 
STRUCTURAL REFORMS
GST
• 20 per cent reduction in turn around time for trucks.
• Benefit to MSMEs through enhanced threshold and 
composition limits.
companies.
p
• Savings of about 4 per cent of monthly spending 
for an average household. 
• In last 2 years, 60 lakh new taxpayers added and 
105 crore e-way bills generated
1
Page 2


Prominent Themes of the Budget
Ease of 
Governance
Financial 
Aspirational Economic 
Caring Society
Living
Governance
sector
sp a o a
India
Agriculture, Irrig
ation and Rural 
Development
co o c
Development
Industry, Comm
erce and 
Investment
Caring Society
Women & 
Child, Social 
Welfare
Wellness, Water 
and Sanitation
Infrastructure
Culture and 
Tourism
Education and 
Skills
New Economy
Environment and 
Climate Change
GOVERNANCE
IBC
• Honourable 
exit through 
IBC for 
STRUCTURAL REFORMS
GST
• 20 per cent reduction in turn around time for trucks.
• Benefit to MSMEs through enhanced threshold and 
composition limits.
companies.
p
• Savings of about 4 per cent of monthly spending 
for an average household. 
• In last 2 years, 60 lakh new taxpayers added and 
105 crore e-way bills generated
1
DIGITAL REVOLUTION
Shift to DBT
• During 2018-
19, `7 lakh crore
tf d
Next wave
• Digital Governance.
• Improve physical quality of life through 
Nti lIf t t Pi li transferred 
through DBT.
National Infrastructure Pipeline
• Disaster Resilience.
• Social Security through Pension and 
Insurance penetration.
INCLUSIVE GROWTH
• Governance guided by “Sabka Saath, Sabka Vikas, Sabka
Vishwas” with focus on:
• Preventive Healthcare: Provision of sanitation and water
• Healthcare: Ayushman Bharat
• Clean energy: Ujjawala and Solar Power
• Financial Inclusion Credit support and Pension • Financial Inclusion, Credit support and Pension
• Affordable Hosuing
• Digital penetration
FINANCIAL SECTOR
• Deposit Insurance Coverage to increase from `1 lakh to `5 
Lakh per depositor.
• Eligibility limit for NBFCs for debt recovery under SARFAESI 
Act proposed to be reduced to asset size of `100 crore or 
loan size of `50 Lakh.
• Proposal to sell balance holding of government in IDBI Bank Proposal to sell balance holding of government in IDBI Bank.
• Separation of NPS Trust for government employees from 
PFRDAI.
• Specified categories of government securities would be opened Specified categories of government securities would be opened 
for non resident investors
• FPI Limit for corporate bonds to be increased to 15 per cent.
• New debt ETF proposed mainly for government securities.
2
Page 3


Prominent Themes of the Budget
Ease of 
Governance
Financial 
Aspirational Economic 
Caring Society
Living
Governance
sector
sp a o a
India
Agriculture, Irrig
ation and Rural 
Development
co o c
Development
Industry, Comm
erce and 
Investment
Caring Society
Women & 
Child, Social 
Welfare
Wellness, Water 
and Sanitation
Infrastructure
Culture and 
Tourism
Education and 
Skills
New Economy
Environment and 
Climate Change
GOVERNANCE
IBC
• Honourable 
exit through 
IBC for 
STRUCTURAL REFORMS
GST
• 20 per cent reduction in turn around time for trucks.
• Benefit to MSMEs through enhanced threshold and 
composition limits.
companies.
p
• Savings of about 4 per cent of monthly spending 
for an average household. 
• In last 2 years, 60 lakh new taxpayers added and 
105 crore e-way bills generated
1
DIGITAL REVOLUTION
Shift to DBT
• During 2018-
19, `7 lakh crore
tf d
Next wave
• Digital Governance.
• Improve physical quality of life through 
Nti lIf t t Pi li transferred 
through DBT.
National Infrastructure Pipeline
• Disaster Resilience.
• Social Security through Pension and 
Insurance penetration.
INCLUSIVE GROWTH
• Governance guided by “Sabka Saath, Sabka Vikas, Sabka
Vishwas” with focus on:
• Preventive Healthcare: Provision of sanitation and water
• Healthcare: Ayushman Bharat
• Clean energy: Ujjawala and Solar Power
• Financial Inclusion Credit support and Pension • Financial Inclusion, Credit support and Pension
• Affordable Hosuing
• Digital penetration
FINANCIAL SECTOR
• Deposit Insurance Coverage to increase from `1 lakh to `5 
Lakh per depositor.
• Eligibility limit for NBFCs for debt recovery under SARFAESI 
Act proposed to be reduced to asset size of `100 crore or 
loan size of `50 Lakh.
• Proposal to sell balance holding of government in IDBI Bank Proposal to sell balance holding of government in IDBI Bank.
• Separation of NPS Trust for government employees from 
PFRDAI.
• Specified categories of government securities would be opened Specified categories of government securities would be opened 
for non resident investors
• FPI Limit for corporate bonds to be increased to 15 per cent.
• New debt ETF proposed mainly for government securities.
2
Macroeconomic Indicators
GDP Growth Rate (per cent)
CPI and WPI (per cent)
4
4.5
5
5.5
6
6.5
7
7.5
8
8.5
-2
0
2
4
6
4-15
5-16
6-17
7-18
-19 
April-
er)
CAD/Forex (per cent)
-4
2014
2015
2016
2017
2018
2019-20(A
Decembe
CPI-C WPI
9,000
Net FDI
5
10
15
20
25
30
35
CAD/Forex (per cent)
2,000
3,000
4,000
5,000
6,000
7,000
8,000
US $ Million
Trends in Deficits
0
5
-1,000
0
1,000
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
Apr-19
Jul-19
Oct-19
3
3.5
52
53
nt)
ent)
Debt
0.9
0.7
04 04
04
0.7
0.4
4.1
3.9
3.5
3.5
3.4
3.8
3.5
3.2
3.4
3.6
3.8
4.0
4.2
0.3
0.5
0.7
0.9
1.1
Percent of GDP
Percent of GDP
0
0.5
1
1.5
2
2.5
3
45
46
47
48
49
50
51
52
External Debt (per cen
tral Government Debt (per ce
0.4 0.4
0.4
0.4
3.0 0.1
PD FD (RHS)
Cen
Central Government Debt as per cent of GDP
External Debt as per cent of GDP at current 
exchange rate
3
Page 4


Prominent Themes of the Budget
Ease of 
Governance
Financial 
Aspirational Economic 
Caring Society
Living
Governance
sector
sp a o a
India
Agriculture, Irrig
ation and Rural 
Development
co o c
Development
Industry, Comm
erce and 
Investment
Caring Society
Women & 
Child, Social 
Welfare
Wellness, Water 
and Sanitation
Infrastructure
Culture and 
Tourism
Education and 
Skills
New Economy
Environment and 
Climate Change
GOVERNANCE
IBC
• Honourable 
exit through 
IBC for 
STRUCTURAL REFORMS
GST
• 20 per cent reduction in turn around time for trucks.
• Benefit to MSMEs through enhanced threshold and 
composition limits.
companies.
p
• Savings of about 4 per cent of monthly spending 
for an average household. 
• In last 2 years, 60 lakh new taxpayers added and 
105 crore e-way bills generated
1
DIGITAL REVOLUTION
Shift to DBT
• During 2018-
19, `7 lakh crore
tf d
Next wave
• Digital Governance.
• Improve physical quality of life through 
Nti lIf t t Pi li transferred 
through DBT.
National Infrastructure Pipeline
• Disaster Resilience.
• Social Security through Pension and 
Insurance penetration.
INCLUSIVE GROWTH
• Governance guided by “Sabka Saath, Sabka Vikas, Sabka
Vishwas” with focus on:
• Preventive Healthcare: Provision of sanitation and water
• Healthcare: Ayushman Bharat
• Clean energy: Ujjawala and Solar Power
• Financial Inclusion Credit support and Pension • Financial Inclusion, Credit support and Pension
• Affordable Hosuing
• Digital penetration
FINANCIAL SECTOR
• Deposit Insurance Coverage to increase from `1 lakh to `5 
Lakh per depositor.
• Eligibility limit for NBFCs for debt recovery under SARFAESI 
Act proposed to be reduced to asset size of `100 crore or 
loan size of `50 Lakh.
• Proposal to sell balance holding of government in IDBI Bank Proposal to sell balance holding of government in IDBI Bank.
• Separation of NPS Trust for government employees from 
PFRDAI.
• Specified categories of government securities would be opened Specified categories of government securities would be opened 
for non resident investors
• FPI Limit for corporate bonds to be increased to 15 per cent.
• New debt ETF proposed mainly for government securities.
2
Macroeconomic Indicators
GDP Growth Rate (per cent)
CPI and WPI (per cent)
4
4.5
5
5.5
6
6.5
7
7.5
8
8.5
-2
0
2
4
6
4-15
5-16
6-17
7-18
-19 
April-
er)
CAD/Forex (per cent)
-4
2014
2015
2016
2017
2018
2019-20(A
Decembe
CPI-C WPI
9,000
Net FDI
5
10
15
20
25
30
35
CAD/Forex (per cent)
2,000
3,000
4,000
5,000
6,000
7,000
8,000
US $ Million
Trends in Deficits
0
5
-1,000
0
1,000
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
Apr-19
Jul-19
Oct-19
3
3.5
52
53
nt)
ent)
Debt
0.9
0.7
04 04
04
0.7
0.4
4.1
3.9
3.5
3.5
3.4
3.8
3.5
3.2
3.4
3.6
3.8
4.0
4.2
0.3
0.5
0.7
0.9
1.1
Percent of GDP
Percent of GDP
0
0.5
1
1.5
2
2.5
3
45
46
47
48
49
50
51
52
External Debt (per cen
tral Government Debt (per ce
0.4 0.4
0.4
0.4
3.0 0.1
PD FD (RHS)
Cen
Central Government Debt as per cent of GDP
External Debt as per cent of GDP at current 
exchange rate
3
Tracking Progress in Numbers
3220000
3270000
3320000
Foreign Exchange Reserves (` crore)
8000000
9000000
10000000
Gross Bank Credit (` Crore)
2970000
3020000
3070000
3120000
3170000
Aug-2019
Aug-2019
Aug-2019
Sep-2019
Sep-2019
-Oct-2019
-Oct-2019
Nov-2019
Nov-2019
Dec-2019
Dec-2019
-Jan-2020
-Jan-2020
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
02-
16-
30-
13-
27-
11-
25-
08-
22-
06-
20-
03-
17-
Nov.24, 2017 Mar. 30, 2018 Nov.23, 2018 Mar.29, 2019 Nov.22, 2019
50
60
Distribution of workers by status in 
Employment (per cent)               
2011-12 2017-18
Conventional Power
Renewable Power
Irrigation
Rural Infrastructure
National Infrastructure Pipeline
th
$
0
10
20
30
40
50
Self employed Regular wage/ 
Salaried
Casual labour
0 5 10 15 20
Roads
Urban and Housing
Railways
Rs. Lakh Crores
India is the 5
th
largest economy in the world in terms of GDP at current US $ Trillion.
3.9
USA
GERMANY
CHINA
14.1
2.9
5.2
21.4
INDIA
JAPAN
All figures in US $ 
Trillion
4
Page 5


Prominent Themes of the Budget
Ease of 
Governance
Financial 
Aspirational Economic 
Caring Society
Living
Governance
sector
sp a o a
India
Agriculture, Irrig
ation and Rural 
Development
co o c
Development
Industry, Comm
erce and 
Investment
Caring Society
Women & 
Child, Social 
Welfare
Wellness, Water 
and Sanitation
Infrastructure
Culture and 
Tourism
Education and 
Skills
New Economy
Environment and 
Climate Change
GOVERNANCE
IBC
• Honourable 
exit through 
IBC for 
STRUCTURAL REFORMS
GST
• 20 per cent reduction in turn around time for trucks.
• Benefit to MSMEs through enhanced threshold and 
composition limits.
companies.
p
• Savings of about 4 per cent of monthly spending 
for an average household. 
• In last 2 years, 60 lakh new taxpayers added and 
105 crore e-way bills generated
1
DIGITAL REVOLUTION
Shift to DBT
• During 2018-
19, `7 lakh crore
tf d
Next wave
• Digital Governance.
• Improve physical quality of life through 
Nti lIf t t Pi li transferred 
through DBT.
National Infrastructure Pipeline
• Disaster Resilience.
• Social Security through Pension and 
Insurance penetration.
INCLUSIVE GROWTH
• Governance guided by “Sabka Saath, Sabka Vikas, Sabka
Vishwas” with focus on:
• Preventive Healthcare: Provision of sanitation and water
• Healthcare: Ayushman Bharat
• Clean energy: Ujjawala and Solar Power
• Financial Inclusion Credit support and Pension • Financial Inclusion, Credit support and Pension
• Affordable Hosuing
• Digital penetration
FINANCIAL SECTOR
• Deposit Insurance Coverage to increase from `1 lakh to `5 
Lakh per depositor.
• Eligibility limit for NBFCs for debt recovery under SARFAESI 
Act proposed to be reduced to asset size of `100 crore or 
loan size of `50 Lakh.
• Proposal to sell balance holding of government in IDBI Bank Proposal to sell balance holding of government in IDBI Bank.
• Separation of NPS Trust for government employees from 
PFRDAI.
• Specified categories of government securities would be opened Specified categories of government securities would be opened 
for non resident investors
• FPI Limit for corporate bonds to be increased to 15 per cent.
• New debt ETF proposed mainly for government securities.
2
Macroeconomic Indicators
GDP Growth Rate (per cent)
CPI and WPI (per cent)
4
4.5
5
5.5
6
6.5
7
7.5
8
8.5
-2
0
2
4
6
4-15
5-16
6-17
7-18
-19 
April-
er)
CAD/Forex (per cent)
-4
2014
2015
2016
2017
2018
2019-20(A
Decembe
CPI-C WPI
9,000
Net FDI
5
10
15
20
25
30
35
CAD/Forex (per cent)
2,000
3,000
4,000
5,000
6,000
7,000
8,000
US $ Million
Trends in Deficits
0
5
-1,000
0
1,000
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
Apr-19
Jul-19
Oct-19
3
3.5
52
53
nt)
ent)
Debt
0.9
0.7
04 04
04
0.7
0.4
4.1
3.9
3.5
3.5
3.4
3.8
3.5
3.2
3.4
3.6
3.8
4.0
4.2
0.3
0.5
0.7
0.9
1.1
Percent of GDP
Percent of GDP
0
0.5
1
1.5
2
2.5
3
45
46
47
48
49
50
51
52
External Debt (per cen
tral Government Debt (per ce
0.4 0.4
0.4
0.4
3.0 0.1
PD FD (RHS)
Cen
Central Government Debt as per cent of GDP
External Debt as per cent of GDP at current 
exchange rate
3
Tracking Progress in Numbers
3220000
3270000
3320000
Foreign Exchange Reserves (` crore)
8000000
9000000
10000000
Gross Bank Credit (` Crore)
2970000
3020000
3070000
3120000
3170000
Aug-2019
Aug-2019
Aug-2019
Sep-2019
Sep-2019
-Oct-2019
-Oct-2019
Nov-2019
Nov-2019
Dec-2019
Dec-2019
-Jan-2020
-Jan-2020
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
02-
16-
30-
13-
27-
11-
25-
08-
22-
06-
20-
03-
17-
Nov.24, 2017 Mar. 30, 2018 Nov.23, 2018 Mar.29, 2019 Nov.22, 2019
50
60
Distribution of workers by status in 
Employment (per cent)               
2011-12 2017-18
Conventional Power
Renewable Power
Irrigation
Rural Infrastructure
National Infrastructure Pipeline
th
$
0
10
20
30
40
50
Self employed Regular wage/ 
Salaried
Casual labour
0 5 10 15 20
Roads
Urban and Housing
Railways
Rs. Lakh Crores
India is the 5
th
largest economy in the world in terms of GDP at current US $ Trillion.
3.9
USA
GERMANY
CHINA
14.1
2.9
5.2
21.4
INDIA
JAPAN
All figures in US $ 
Trillion
4
Budget at a glance
Revenue  Expenditure (in ` 
Capital Expenditure (in ` crore) 
20,00,000
24,00,000
28,00,000
p (
crore) 
2,80,000
3,50,000
4,20,000
pp ( )
0
4,00,000
8,00,000
12,00,000
16,00,000
0
70,000
1,40,000
2,10,000
Revenue Receipts (in ` crore)
Capital Receipts (in Rs
14,00,000
21,00,000
Revenue Receipts (in ` crore) 
800000
10,00,000
12,00,000
Capital Receipts (in Rs. 
crore)
0
7,00,000
0
2,00,000
4,00,000
6,00,000
8,00,000
5