Yojana March 2019: Development (Part-1) (Download PDF)

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Key Topics Included In This Article: Pradhan Mantri Kisan Samman Nidhi (PM-KISAN), Rashtriya Kamdhenu Aayog, Pradhan Mantri Shram-Yogi Maandhan, Aspirational Districts Programme (ADP), Civil Service, Legal, Judicial & Police Reforms, Mahila Kisan Sashaktikaran Pariyojana (MKSP), Convention on Rights of Child.

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Development: Yojana March 2019 (In English)

Dr. Manishika Jain explains Yojana March 2019: Development

  • Development has wide-ranging perspectives. It means improvement in various sectors relating to country’s economy, issues affecting daily life of common man, child development, gender justice, et al.
  • Financial inclusion is at core of fiscal development of nation.
  • Good governance is another vital aspect of national development because it ensures that scheme & programmes of Govt. reach persons they are targeted towards. Key reforms in education, health, child development regional development, legal, police & judicial reforms are part of good governance.
  • Health Care is another key area which ensures development of nation. Improvement in health services & broadening of range of health services to reach poorest of poor, in remotest of areas is aim of Govt. schemes.

Budget: An Overview

  • Scheme called ‘Pradhan Mantri KisanSamman Nidhi (PM-KISAN) is for farm sector.
  • Under this scheme, vulnerable landholding farmer families, having cultivable land upto 2 ha will be provided direct income support at rate of Rs. 6,000 per year.
  • Income support will be transferred directly into bank accounts of beneficiary farmers, in 3 equal instalments of Rs. 2,000 each.
  • Programme will entail annual expenditure of Rs. 20,000 in current fiscal year & Rs. 75,000 cr. during next fiscal year.
  • Interim Budget proposed various measures for farm sector which include:

o Benefit of 2 % interest subvention to framers pursuing activities of animal husbandry & fisheries who avail loan thru KCC. In case of timely repayment of loan, they will get additional 3 % interest subvention.

o All farmers affected by severe natural calamities, where assistance is provided from National Disaster Relief Fund (NDRF), will be provided benefit of interest subvention of 2% & prompt repayment incentive of 3 % for entire period of re-schedulement of their loans.

o Rashtriya Kamdhenu Aayog to be set up to upscale sustainable genetic up-gradation of cow resources & to enhance production & productivity of cows.

Work Force

  • ‘Pradhan Mantri Shram-Yogi Maandhan mega pension scheme for unorganised sector workers w/monthly income upto Rs. 15,000 is introduced in budget.
  • Scheme will provide assured monthly pension of Rs. 3,000 from age of 60 years on monthly contribution of small affordable amount during their working age.
  • It is expected that at least 10 cr. laborers & workers in unorganised sector will avail benefit w/I next 5 years. Sum of Rs. 500 cr. is allocated for scheme & will be implemented from current year. LIC will manage scheme.

De-notified, Nomadic & Semi-Nomadic communities

  • Interim Budget proposed that Committee under NITI Aayog will be set up to complete task of identifying De-notified, Nomadic & Semi-Nomadic communities.

Middle Class/Salaried Class

  • Individuals w/taxable income upto Rs. 5 lakh will get full tax rebate. If net taxable income doesn’t exceed Rs. 5 lakh, then there is no need to pay any tax.
  • If it exceeds Rs. 5 lakh then taxes will be calculated as per current tax structure. This will give relief to around 3 cr. middle class tax payers like self-employed, small business, small-traders, salary earners, pensioners & senior citizens.
  • For salaried persons, it is proposed to increase standard deduction to Rs. 50,000 from Rs. 40,000. This will benefit salaried individuals at max. amount of Rs. 3000 per person in a year, depending upon IT structure.
  • This will have fiscal cost of around Rs. 4700 cr. to provide tax relief to approx. 3.85 cr. salary earners & pensioners.

Other Tax Proposals

  • Budget has proposed to raise limit of TDS threshold for interest earned on bank & post office deposits to Rs. 40,000 from Rs. 10,000 currently.
  • TDS for deduction of tax on rent is proposed to be increased from Rs. 1.8 lakh to Rs. 2.4 lakh for providing relief to small taxpayers.
  • There is proposal of faceless scrutiny which means, in next 2 years, almost all verifications & assessment of returns selected for scrutiny will be done electronically, w/o any personal interface b/w taxpayers & tax officers.

Taxation Proposals

Image of Simplification of Direct Tax System

Image of Simplification of Direct Tax System

Image of Simplification of Direct Tax System

Decoding Taxation Proposals

  • Tax benefits of Rs. 18,500 cr. is proposed to be provided to estimated 3 cr. middle class & small taxpayers comprising self-employed, small business, small traders, salary earners, pensioners & senior citizens.
  • Tax exemption on long-term capital gains om sale of residential house will be available for investment in up to 2 residential house properties located in India against one earlier.
  • Option is available only once in lifetime for individuals of HUFs where capital gains on sale of house property is up to Rs. 2 cr.
  • This will allow individuals of HUFs to sell one house property & make investment in 2 w/o paying any capital gains tax.

TDS

  • Threshold for TDS on interest income from deposits w/banks & post offices has increased from Rs. 10,000 to 40,000.
  • Threshold for TDS on rent paid by any person to a resident has increased from Rs. 1.8 lakh per year to Rs. 2.4 lakh per year. This will provide administrative relief to small taxpayers, if they have let out their flats to companies. If a tenant is small individual taxpayer, then TDS will apply only if rent pay-out is more than Rs. 50,000 per month.

Making IT more Tax Payer Friendly

  • Under plan to make IT Dept. more taxpayer friendly, IT dept. plans to process IT returns w/I 24 hr. & issue refunds simultaneously.
  • This is relief for tax payers who until now, have had to wait for months to get their tax refunds after filing their returns in financial year.
  • Under PM-KISAN direct income support at rate of Rs. 6000 per year to farmer families, having cultivable land upto 2 ha is announced.

Fiscal Deficit

  • Fiscal deficit is brought down to 3.4 % in 2018 - 19 RE from almost 6 % 7 years ago.
  • Current Account Deficit (CAD) against 5.6 % 6 years ago, is likely to be only 2.5 % of GDP this year.

Key Highlights of Interim Budget 2019 - 20:

o Scheme for 12 cr. Small & Marginal farmers w/direct income support

o Pension initiative for 10 cr. unorganized sector workers

o Exempting income up to Rs. 5 lakhs from IT

o Reforms in stamp duty

o Highest ever budgetary allocation of Rs. 3 lakh cr. for Defence

o Record allocation of funds at Rs. 58,166 cr. for North Eastern Areas

o New AIIMS for Haryana,

o Single window clearance for Indian film makers at par w/foreigners & higher budgetary allocations for Education, , Health, Infrastructure & for welfare of weaker sections including SC & ST & Separate Dept. of Fisheries.

Strengthening the Financial System

  • Financial Inclusion is globally considered to be critical indicator of development & well-being of society.
  • Inclusive Financial Development is need of hour. For Financial Inclusion to be more effective there is need for digital infrastructure & digital literacy in small towns & rural India.
  • Financial inclusion is to ensure that there is financial depth in terms of increasing ratio of deposits to GDP, number of financial institutions & banks, number of accounts per thousand, increasing number of bank branches per 100,000 adults, adequate market capitalization etc.
  • Financial Inclusion facilitates access to financial system, allowing them to build financial & physical assets, seek credit for their education, healthcare & business & also save for unexpected exigencies & old age.
  • It helps reducing poverty & inequality. It offers array of financial services that provide protection in case of untimely death or accident of bread earner & provides safety net in old age.
  • Steps are taken towards financial inclusion like No-Frill accounts, OD in savings accounts, BC/BF model, KCC/GCC guidelines, SHC, Core Banking System (CBS), NEFT, NECS, Immediate Payment Service (IMPS) & Aadhar Enabled Payment System (AIPS) etc.
  • Financial inclusion program known as Pradhan Mantri Jan Dhan Yojana (PMJDY) w/0 balance is helping people to become part & parcel of mainstream of economic development.
  • It provides interest on deposit, accidental insurance cover of Rs. 1 lakh, no min. balance requirement, life insurance cover of Rs. 30,000 overdraft facility after 6 months, RuPay Debit Card & Overdraft facility up to Rs. 5000/- to only one a/c per household.
  • Mudra Yojana aims to generate employment & promote start ups to strengthen availability of credit up to 10 lakhs to poor & small entrepreneurs.
  • Features relating to financial inclusion in Interim Union Budget 2019 are direct income support of Rs. 6000 per annum to 12 cr. farmers to be transferred directly to their bank accounts, under PM-Kisan, pension plan under PM Shram-Yogi Maandhan for 10 cr. shramiks or workers; extension of KCC scheme to Animal Husbandry, Interest subvention, pvt. sector lending to provide access to credit for those who are vulnerable & marginalized.
  • Public Sector banks lend abt. Rs. 20,723 billion or 39.9 % of their net bank credit to priority sector, pvt. sector lending was abt. Rs. 8,046 billion or 40.8 % of their net lending, foreign banks lending was abt Rs. 1,402 billion or 38.3 % of their net lending in 2017 - 18.
  • Banks are advised to prepare financial inclusion plan & inform RBI abt number of outlets, Basic Savings Bank Deposit Accounts (BSBDAs), overdraft facilities availed in those accounts, transactions in KCCs & GCC accounts & transactions thru Business Correspondent-Information & Communication Technology (BC-ICT) channel.
  • There is need to encourage FINTECH use of software & modern technology i. e. use of smart phones, for mobile banking, investing services & crypto currency, block chain to help make financial services more accessible to general public.

Good Governance: Cornerstone to Development

  • Bhagvad Gita provides numerous cues for good governance, leadership, dutifulness & self-realization which are re-interpreted in modern context.
  • In Kautilya’s Arthshastra (2nd-3rd century BC), welfare of people was considered paramount in role of King.
  • Mahatma Gandhi emphasized “su-raj” which essentially means good governance.
  • Importance of governance is clearly inscribed in Indian Constitution which is built on premise of Sovereign, Socialist, Secular & Democratic Republic committing itself to democracy, rule of law & welfare of people.
  • UN has defined 8 pillars of good governance as:

⁻ Consensus Oriented

⁻ Accountable

⁻ Transparent

⁻ Responsible

⁻ Equitable & Inclusive

⁻ Effective & Efficient

⁻ Rule of Law & Participatory

Image of Good Governace And Democracy

Image of Good Governace And Democracy

Image of Good Governace And Democracy

  • Under Sustainable Development goals, Goal 16 can be considered to be directly linked as it is dedicated towards improvement in governance, inclusion, participation, rights & security.

Development Agenda – India@75

  • NITI Aayog has brought out comprehensive document viz. “Strategy for New India@75” spelling out broad roadmap for 75th year of India’s Independence.
  • Document comprising 41 chapters covering almost all sectors, spell out current status, binding constraints & strategies to enable India to become 4 trillion dollar economy by 2022 & lay solid foundation for clean, inclusive, sustained & sustainable growth for next 3 decades.
  • In area of education, one of key reforms suggested is revamped governance system to improve monitoring & accountability.
  • Another reform entails electronic national educational registry for tracking each child’s learning outcomes & final exams thru unique ID.
  • This will assist in preparing list of children who drop out after elementary education & enable focused attention to needs of children from socially deprived groups & those w/physical or intellectual disabilities.

Aspirational Districts Programme

  • Aspirational Districts Programme (ADP) was launched to transform lives of people in under-developed areas of country in time bound manner.
  • Programme aimed at transforming 115 most backward dist. w/focused interventions in field of health & nutrition, education, agriculture & water mgmt. , financial inclusion & skill development.

Direct Benefits Transfer

  • DBT aims to develop governance regime which ensures simple & user-friendly Govt. to People (G2P) interface & directly delivers entitlements to eligible individuals & households in fair, transparent, efficient & reliable manner.

Benefits:

  • It cuts down multiple layers for delivery of any benefit.
  • It reduces delay in payments
  • It helps in accurate targeting of beneficiaries
  • It facilitates curbing pilferage & duplication of beneficiaries.

Civil Service, Legal, Judicial & Police Reforms

  • Major area of governance reforms is reorientation of administrative set up, legal/judicial system & maintaining law & order.
  • W/change in socio-economic fabric, emergence of new mechanisms of service delivery & over 2.7 cr. cases pending in various courts, this is area requiring urgent attention.

Civil Service Reforms

  • Improve teeth to tail ratio & promote officer-oriented culture.
  • Reduce number of current 60 plus separate civil services at central & state level thru rationalization & harmonization of services.
  • Encourage lateral entry by inducing specialists especially at higher levels.
  • Bring down entry age in civil services.
  • Strengthen municipal cadres & outsource service delivery in possible areas.
  • Develop inclusive citizen-centric framework in terms of service delivery, grievance redressal & public access to information w/enhanced use of ICT.
  • Ensure probity in governance by strengthening institutional mechanism for prevention & detection of corruption, while at same time protect honest civil servants.

Legal Reforms

  • Create repository of all existing central & state laws, rules & regulations.
  • Repeal redundant laws & remove restrictive clauses in existing laws.
  • Reform criminal justice & procedural laws w/focus on pre-institution mediation.
  • Reduce criminalization of violation & move towards compounding of minor offences.
  • Prioritize court process automation & ICT enablement for electronic court & case mgmt.
  • Introduce administrative cadre in judicial system.

Police Reforms

  • Modernising police forces & implementing Model Police Act of 2015.
  • States to ensure grater representation of women in police force.
  • Introduction of remodeled training modules, refresher courses & continuing education for police personnel.
  • Reform of FIR lodging mechanism, including introducing filing e-FIRs for minor offences.
  • Launch common nation-wide emergency contact number to attend to emergency security needs of citizens.
  • Instituting separate cadre for cyber-crimes, cyber threats & fraud.

E-Governance

  • To ensure New India by 2022, some fundamental principles may need to be prioritized.
  • These include:

o Making services available to public in faceless, paperless & cashless mode

o Providing connectivity & digital identity to all

o Targeting benefits thru Aadhar enabled DBT

o Simplifying forms & processes & providing e-platforms.

  • AI can play major role in better implementation.
  • Portals like Centralized Public Grievance Redressal & Monitoring System (CPGRAMs), UMANG & MyGov need to be made more effective in information exchange, seeking feedback & addressing grievance of citizens.

Paving the Way for Better Health Outcomes

  • Better health of people is intrinsically linked to & contributes to economic growth & overall development of nation.
  • Health is social contract b/w people & govt. Global discourse on advancing universal health coverage is opportunity for govt. at all levels to increase govt. spending on health, improve overall health services provision; make provision of public health services & to develop mechanism for providing financial protection.

Improving Health Services

  • National Rural Health Mission (NRHM) & then National Urban Health Mission has created foundation for strengthening provision of health services in India.
  • Ayushman Bharat Program (ABP) has components to strengthen primary health care & health insurance for 40 % of poorest families in India.
  • By 31st Jan. , 2019 total 6,600 HWCs are made functional & under PMJAY.
  • In Feb. , 2017 Tamil Nadu started UHC pilot where 67 sub-centres in 3 blocks in 3 dist. , were strengthened by improving infrastructure, provision of additional health workers & ensuring supplies of medicines & diagnostics.
  • Kerala is reforming primary healthcare thru setting up Family Health Centres (FHC) & Rajasthan is working on improving Primary Health Care Centres etc.
  • ‘Mohalla or community clinics’ in Delhi & ‘Basti Dawakhana’ in Telangana are emerging as new models for strengthening urban primary health services.
  • ‘Atal Ayushman Uttrakhand would cover entire population in state.
  • Himachal Pradesh under ‘Him Care’ is offering similar cover as in PMJAY, to additional population on pre-payment of premium.
  • Meghalaya, Karnataka, Chhattisgarh & Punjab have extended coverage to additional population.

Broad Ranging of Health Services

  • India has mixed health care system, where Pvt. sector provides majority of health services.
  • Pvt. Sector focuses on care for sick people & provision of curative & diagnostic services & risk system becoming focused.

Increasing Govt. Spending

  • Average govt. spending on health as proportion of GDP stands at around 5% & in terms of proportion of govt. budget at 10%.
  • Level of govt. expenditure on health in India, is 1.15 % of GDP & nearly 4 % of govt. budget.
  • NHP 2017 proposed:

o To increase govt. funding to 2.5 % of GDP by 2025

o States should spend 8 % of their budget on health by 2020.

Interim Budget

  • New AIIMS is proposed to be set up in Haryana, making total number of AIIMS in India to 22.
  • ‘Healthy India’ is identified as one of 10 dimensions under Vision for India by 2030.

Way Forward

Put Primary Health Care (PHC) first

  • Govt. spending on PHC makes health services efficient; reduces cost & helps in delivery of prevention & promotive health services.
  • PHC system can tackle up to 80 % of health needs & can reduce need for specialized health services.
  • Indian states have elaborate network of primary healthcare facilities.

Focus on Financial Protection & not ‘Notional Coverage’ only

  • NITI Aayog’s 5 year strategic plan for new India has proposed to increase health insurance coverage to 75 % population by 2022.

- Published/Last Modified on: March 28, 2019

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