Proposals of Budget 23 for Electrical Sector

?Dear All,

The Budget’23 adopts the following seven priorities:-

1) Inclusive Development

2) Reaching the Last Mile

3) Infrastructure and Investment

4) Unleashing the Potential

5) Green Growth

6) Youth Power

7) Financial Sector

This budget has not given direct financial outlay to electrical infrastructure or projects but there are some policies and schemes which will indirectly boost the electrical sector's growth in long term such as:-

• Capital investment outlay is being increased steeply for the third year in a row by 33 per cent to Rs 10 lakh crore, which would be 3.3 per cent of GDP. This will be almost three times the outlay in 2019-20. The ‘Effective Capital Expenditure’ of the Centre is budgeted at Rs 13.7 lakh crore, which will be 4.5 per cent of GDP.
• A capital outlay of Rs 2.40 lakh crore has been provided for the Railways. This highest ever outlay is about 9 times the outlay made in 2013-14.
• To steer the economy on the sustainable development path, Battery Energy Storage Systems with capacity of 4,000 MWH will be supported with Viability Gap Funding. A detailed framework for Pumped Storage Projects will also be formulated.
• The Inter-state transmission system for evacuation and grid integration of 13 GW renewable energy from Ladakh will be constructed with investment of Rs 20,700 crore including central support of Rs 8,300 crore.
• To facilitate availability of raw materials for the steel sector, exemption from Basic Customs Duty on raw materials for manufacture of CRGO Steel, ferrous scrap and nickel cathode is being continued.
• Similarly, the concessional BCD of 2.5 per cent on copper scrap is also being continued to ensure the availability of raw materials for secondary copper producers who are mainly in the MSME sector.
• To provide stipend support to 47 lakh youth in three years, Direct Benefit Transfer under a pan-India National Apprenticeship Promotion Scheme will be rolled out.
• Special Support for MSME’s was given in this budget as follows:-
• In cases of failure by MSMEs to execute contracts during the Covid period, 95 per cent of the forfeited amount relating to bid or performance security, will be returned to them by government and government undertakings. This will provide relief to MSMEs.
• Revamped credit guarantee scheme for MSMEs scheme will take effect from 1st April 2023 through infusion of Rs 9,000 crore in the corpus. This will enable additional collateral-free guaranteed credit of Rs 2 lakh crore. Further, the cost of the credit will be reduced by about 1 per cent.
• Deduction for expenditure incurred on payments made to MSME’s will be allowed only when payment is actually made to MSME’s.

Biggest relief has been given for personal income tax:-

• Currently, those with income up to Rs 5 lakh do not pay any income tax in both old and new tax regimes. This rebate limit has been increased to Rs 7 lakh in the new tax regime. Thus, persons in the new tax regime, with income up to Rs 7 lakh will not have to pay any tax.
• The tax structure in this regime has been reducing to five slabs, increasing the tax exemption limit to Rs 3 lakh. This will provide major relief to all tax payers in the new regime. The new tax rates are in the pic enclosed at the top.
• The salaried class and the pensioners including family pensioners will get the benefit of standard deduction in the new tax regime. Each salaried person with an income of Rs 15.5 lakh or more will thus stand to benefit by Rs 52,500.
• Highest surcharge rate from 37 per cent has been reduced to 25 per cent in the new tax regime. This would result in reduction of the maximum tax rate to 39 per cent.
• Tax exemption on leave encashment on retirement of non-government salaried employees has been increased to Rs 25 lakh.

The budget has given great relief to middle class and if the execution of infrastructure development happens on the ground as per the budget provided, then our country will soon be branded as developed nation.

Regards,

TEAM JDS