Ahead of Finance Minister Nirmala Sitharaman's third Union Budget - scheduled to be tabled on February 1, 2021 - it is imperative to recall major points from her last financial blueprint. Here's a quick recap of Budget 2020.
Income Tax changes: A new tax regime was announced, proposing 10 percent tax on annual income between Rs 5-7.5 lakh, 20 percent on Rs 7.5-10 lakh, 25 percent on Rs 10-12.5 lakh, and 30 percent on Rs 15 lakh and above. Those switching to the new tax slab were, however, required to forego their tax rebates and exemptions. The option of continuing under the old tax regime was also granted.
GDP estimate: The government had estimated a nominal GDP growth rate of 10 percent (i.e. real growth plus inflation) in 2020-21. In the preceding year (2019-20), the nominal growth estimate was 12 percent.
Fiscal deficit target: The Finance Minister had announced a fiscal deficit target of 3.5 percent of the GDP for the financial year 2020-21. The revenue deficit was targeted as 2.7 percent of the GDP.
Divestment target: An ambitious disinvestment target of Rs 2.1 lakh crore was set by the government while presenting the Budget last year. The targeted amount included a plan to raise around Rs 90,000 crore through divestment in some public sector banks and financial institutions.
Frequently Asked Questions
A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.
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Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.
Education sector: The government announced a total outlay of Rs Rs 99,300 crore for the education sector in 2020-21. Another Rs 3,000 crore was allotted for skill development.
Healthcare sector: Rs 69,000 crore was allotted for the health sector, along with an announcement to expand Jan Aushadhi Kendras to all districts for providing medicines at affordable rates.
Agriculture sector: The Finance Minister had listed a 16-point plan of action to double the income of farmers by 2022. The agricultural credit target was set at Rs 15 lakh crore, and the NABARD Refinancing Scheme was stated to be further expanded.