By Jitendra Asati & DC Patra
Indian Union Budget 2021-22: Union Budget FY22, methodically presented by FM, sums up the grit and determination of a resurgent India, braving out of the Covid crisis to rewrite the aspirations of 1.3 billion Indians. The Budget reflects the concentrate of the government beneath the astute leadership of PM Modi emphasising that India will surge ahead, out of the shadow of the pandemic. It lays the blueprint for wealth and wellness, aiming at sustainability and inclusiveness.
The Budget is constructed on the premise that India will rebuild itself with the instrumentality of self-reliance, infrastructure investment and innovation. Resources will be mobilised by outstretching the boundaries of fiscal buoyancy. Public sector assets will be unlocked with the participation of private and foreign capital. Connectivity, each physical and digital, will mobilise the underemployed sources and make worth.
The government injected an estimated Rs 27 lakh crore of stimuli into the economy in the course of 2020, 13% of GDP, which is anticipated to transmit into waves of financial activities in the course of 2021. This is the substantially-expected stimulus, to sustain demand and will counter the incipient recession exhibited in the course of the 1st two-quarters of FY21. Economic activities began selecting up in the third quarter. Together with the series of structural reforms unleashed by the government, in the arena of all-natural sources, labour, farming, PDS, education, MSME and tax administration, conjures with a young India putting itself at the centre of the globe financial stage.
On the wellness and wellness front, in addition to the National Health Mission, a new scheme PM AtmaNirbhar Swasth Bharat Yojana, with an outlay of Rs 64,180 crore to be spent more than six years, will strengthen the foundation of wholesome India at key, secondary and tertiary level. Provision of Rs 2.23 lakh crore towards wellness for FY22 is a marked jump. The urban Swachh Bharat Mission, with an outlay of `1.41 lakh crore, to be spent more than 5 years, is equally a substantially necessary simple urban living requirement.
Ensuring power justice and pursuing the green path to progress have been the essential drivers of power policymaking beneath the Modi government. The oil & gas (O&G) sector, with its complicated worth network, will fuel the economy at every single point of production, consumption, distribution and trade. O&G sector has been contributing above 3% to the economy’s gross worth addition in the course of the final 5 years, in true terms. At 262 MMT in the course of FY20, Indian O&G Industry has been increasing at a CAGR of 5.1% and supported the true GDP to develop at 6.8% in the course of the final six years.
FM highlighted that O&G sector has served the nation in the course of the lockdown period by maintaining the fuel provide operating. Furthering the approach of power justice and de-carbonisation of the economy, FM has announced some essential measures: PMUY scheme has been instrumental in ending power poverty and bringing socio-financial alter. After reaching phenomenal results in delivering 8-crore cost-free LPG connections beneath PMUY, Budget FY22 has extended the target to cover one crore more households.
Coverage of City Gas Distribution (CGD) projects is getting expanded to 232 geographical places spread more than 400 districts with a possible to cover about 53% of the country’s geography and 70% of the population. The Budget announced that one hundred more districts will be covered beneath city gas distribution in the course of the next 3 years. These are powerful instruments towards attaining a low carbon economy, taking India closer towards fulfilling its Paris COP21 commitment. Budget FY22 also announced the expansion of the all-natural gas pipeline to cover J&K.
Other measures announced in the Budget are the setting up of an independent gas transport method operator, which will facilitate a widespread carrier network in all-all-natural gas pipelines on an open-access basis. India plans to raise gas share in the power mix to 15% from the existing 6.2%.
Towards that finish, measures such as creating gas import facilities, setting up gas trading exchanges and the provision of promoting and pricing freedom to producers have currently been taken. India aims to raise gas transmission capacity by 580 mmscmd from the existing 330 mmscmd, as it doubles the existing 17,000 km gas pipeline network in 3-4 years. The government also plans to attract private investment into brownfield projects by monetising the assets of public sectors. Under that scheme, the oil & gas pipeline of GAIL, IOC & HPC have been proposed.
Strategic disinvestment of PSEs has been an avowed policy of the government to unlock worth and use these as fiscal assistance for other welfare and developmental measures. The Budget proposes to safe Rs 1.75 lakh crores from the disinvestment proceeds. A huge chunk of which is anticipated to materialise from the sale of government’s holding in BPCL/CONCOR and so forth.
The Budget also proposes launching National Hydrogen Mission to produce hydrogen from green energy sources, a step towards net-zero emissions. Overall, the oil & gas sector is visualised to stay as a catalyst in the transformation procedure that Budget FY22 has set in.
Asati is an Indian Economic Service officer, and Patra is with Bharat Petroleum. Views are private