The budget session of Parliament every year starts with the President’s Address to both Houses.  In this speech, the President highlights the government’s achievements and legislative activities in the last year, and announces its agenda for the upcoming year.   The address is followed by a motion of thanks that is moved in each House by ruling party MPs.  This is followed by a discussion on the address and concludes with the Prime Minister replying to the points raised during the discussion.

Today, the Budget Session 2019 commenced with the President, Mr. Ram Nath Kovind addressing a joint sitting of Parliament.  In his speech, he highlighted some of the objectives that the government has realised in the past year.  The President also highlighted the progress made by the government under various development schemes such as the Swachh Bharat Abhiyan, the Pradhan Mantri Jan Dhan Yojana, and the Pradhan Mantri Gram Sadak Yojana. 

Given that today’s address comes at the end of this government’s term, we examine the status of some key policy initiatives announced by the current government, that have been highlighted in speeches made in the past five years.  

Policy priority stated in President’s Addresses 2014-2018

                                                                       Current Status

Economy and Finance

Despite a global economic downturn, the Indian economy has remained on a high growth trajectory.

 

  • Growth Rate: The GDP is estimated to grow at 7.2% in 2018-19.[i]  In the last five years, GDP growth rate stayed within 7% and 8% per year, with a dip to 6.7% in 2017-18, the year of demonetisation.[ii],[iii]
  • Inflation: A target of 4% for the Consumer Price Index (CPI) inflation was notified by the Ministry of Finance for the period 2016-2021.[iv] CPI stayed within this band for most of the period between 2014 and 2018.
  • Foreign Exchange Reserves stood at USD 397 billion on January 2019, as compared to USD 313 billion in May, 2014.[v],[vi]

Measures to deal with corruption, black money and counterfeit currency will be introduced

 

  • Demonetisation:  On November 8, 2016, the Government announced the demonetisation of Rs 500 and Rs 1000 notes.[vii]  During the period from November 2016 to October 2017, undisclosed income of over Rs 24,800 crore was detected.[viii]
  • The Fugitive Economic Offenders Bill, 2018 was passed in July, 2018.  The Bill seeks to confiscate properties of economic offenders who have left the country to avoid facing criminal prosecution.[ix]
  • The Prevention of Corruption (Amendment) Bill, 2013 amends the Prevention of Corruption Act, 1988.  Under the 1988 Act, taking of a bribe by a public official was an offence.  The Bill also makes the giving of a bribe an offence.[x] 

To promote the concept of cooperative federalism through One Nation-One Tax and One Nation-One Market, the government introduced the Goods and Services Tax

  • Goods and Services Tax was introduced across the country from July 1, 2017.[xi]  

Agriculture

Agriculture is the main source of livelihood for a majority of people.  For holistic development of the agricultural sector, the Pradhan Mantri Fasal Bima Yojana was launched in 2016

  • Pradhan Mantri Fasal Bima Yojana (PMFBY):  PMFBY was launched with the aim of providing insurance coverage and financial support to farmers in the event of crop failure.  The number of farmers enrolled under the scheme declined from 5.7 crore in 2016-17 to 5.2 crore in 2017-18.[xii]  

Employment and Entrepreneurship

The government has continuously worked for reforms of labour laws.  Minimum wages have increased by more than 40%

 

  • Over the last three years, the Ministry of Labour and Employment has introduced three draft Codes to simplify labour laws.  These are: (i) the draft Labour Code on Industrial Relations, (ii) the draft Code on Social Security and (iii) the draft Code on Occupational Safety, Health and Working Conditions.60  Additionally, in 2017, the Code on Wages Bill, 2017 was introduced in the Lok Sabha.
  • In 2017, the central government increased minimum wages by 40% through a gazette notification.  Minimum wages (per day) for non-agricultural workers increased from Rs 250 to Rs 350 for unskilled workers and Rs 523 for skilled workers.[xiii],[xiv],[xv]

Infrastructure

Cities are the engines of economic growth.  The Smart City programme was initiated to build modern amenities and infrastructure.

 

  • Smart Cities and the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) have an outlay of Rs 48,000 crore and Rs 50,000 crore for the period 2015-2020, respectively.[xvi]
  • As of January 19, 2018, 100 smart cities have been selected.  As of 2018, the total proposed investment in these cities is Rs 2,05,018 crore.[xvii],[xviii]

All rural habitations will be connected with all-weather roads. So far, 73,000 kilometres of roads have been laid in rural areas.

 

  • The Pradhan Mantri Gram Sadak Yojana (PMGSY) aims to connect all eligible unconnected habitations in rural areas with all-weather roads by March 2019.[xix],[xx]  As of January 29, 2019, of the target of 1.52 lakh habitations to be covered since the inception of the scheme, 1.46 lakh (96%) habitations have been connected.[xxi]  

Housing is a fundamental right.  All households shall have a dwelling unit under the Mission Housing for All by 2022.

 

  • Pradhan Mantri Awas Yojana (PMAY) was launched in 2015.  The Yojana has two components: rural and urban. 
  • Under PMAY-Urban, 5,33,000 have been completed in 2018-19.  Under PMAY-Rural, 14,21,850 have been built in 2018-19. [xxii],[xxiii]

Health and Sanitation

Poor sanitation weakens the economic wherewithal of a poor household.  The Swachh Bharat Abhiyan aims to ensure health and sanitation. 

  • Swachh Bharat Mission: Swachh Bharat Mission (SBM) was launched on October 2, 2014 to achieve a clean and open defecation free India.  It has two components: SBM Urban and SBM Rural. [xxiv],[xxv]
  • Under SBM Urban, as of January 29, 2019, 24,130 individual household toilets have been constructed.[xxvi]
  • Under SBM Gramin, as of January 30, 2019, 919 lakh individual household toilets have been constructed (98.81% of target). [xxvii],[xxviii]

The government is committed to providing affordable and accessible healthcare to all its citizens, particularly the vulnerable groups.

  • Ayushmaan Bharat: In the General Budget 2018-19, the Government announced two major initiatives in health sector as a part of the Ayushman Bharat program.  These were: Health and Wellness Centres and the Pradhan Mantri Jan Arogya Yojana (PMJAY).[xxix]
  • Ayushmaan Bharat aims to create 1,50,000 health and wellness centres providing comprehensive primary healthcare. Rs 1200 crore has been allocated for this purpose.[xxx] PMJAY will cover over ten crore poor and vulnerable families. [xxxi]  It will provide coverage of up to five lakh rupees per family per year for secondary and tertiary care hospitalisation.  For the year 2018-19, Rs 3,125 crore has been allocated for this scheme.[xxxii]

Source: President’s Addresses 2014-2018; PRS.

For important highlights from the President’s address in 2019, please see here.  For a deeper analysis of the status of implementation of the announcements made in the President’s addresses from 2014 to 2018, please see here.

 

[i] “Press Note on First Advance Estimates of National Income: 2018-19”, Ministry of Statistics and Program Implementation, Press Information Bureau, http://www.mospi.gov.in/sites/default/files/press_release/Presss%20note%20for%20first%20advance%20estimates%202018-19.pdf.

[ii] “Second Advance Estimates of National Income, 2017-18”, Ministry of Statistics and Program Implementation, Press Information Bureau, http://pib.nic.in/newsite/PrintRelease.aspx?relid=176847

[iii] “Second Advance Estimates of National Income, 2016-17”, Ministry of Statistics and Program Implementation, Press Information Bureau, http://pib.nic.in/newsite/PrintRelease.aspx?relid=158734

[iv] Overview-Monetary Policy, Reserve Bank of India, https://www.rbi.org.in/scripts/FS_Overview.aspx?fn=2752

[v] “Foreign Exchange Reserves,”  Reserve Bank of India, January 25, 2019, https://www.rbi.org.in/Scripts/WSSView.aspx?Id=22729.

[vi] RBI Database, https://dbie.rbi.org.in/DBIE/dbie.rbi?site=home.

[vii] Table No.  160, Handbook of Statistics on the Indian Economy, Reserve Bank of India, https://www.rbi.org.in/Scripts/AnnualPublications.aspx?head =Handbook%20of%20Statistics%20on%20Indian%20Economy

[viii] Lok Sabha Unstarred Question No.  1319, Ministry of Finance, December 22, 2017, http://164.100.47.194/Loksabha/Questions/QResult15.aspx?qref=59329&lsno=16.

[ix] “The Fugitive Economic Offenders Bill, 2018”, PRS Legislative Research, March 16, 2018, http://www.prsindia.org/sites/default/files/bill_files/Fugitive%20Economic%20Offenders%20Bill%20-%20Bill%20Summary.pdf.

[x] “The Prevention of Corruption (Amendment) Bill”, PRS Legislative Research, February 12, 2014, http://www.prsindia.org/sites/default/files/bill_files/Bill_Summary-_Prevention_of_Corruption_1.pdf.

[xi] “GST roll-out – Complete transformation of the Indirect Taxation Landscape; Some minute details of how it happened, Ministry of Finance”, Press Information Bureau, June 30, 2017, http://pib.nic.in/newsite/PrintRelease.aspx?relid=167023.

[xii] Lok Sabha Unstarred Question No. 17, Ministry of Agriculture and Farmers Welfare, December 11, 2018, http://164.100.47.190/loksabhaquestions/annex/16/AS17.pdf.

[xiii] “Year End Review, Ministry of Labour and Employment”, December 18, 2017, http://www.pib.gov.in/PressReleseDetail.aspx?PRID=1512998.

[xiv] Rate of Minimum Wages, Ministry of Labour and Employment, March 1 2017, https://labour.gov.in/sites/default/files/MX-M452N_20170518_132440.pdf.

[xv] Gazette Number 173, Ministry of Labour and Employment, January 19, 2017, Gazette of India, http://egazette.nic.in/WriteReadData/2017/173724.pdf.

[xvi] “Union Cabinet approves Atal Mission for Rejuvenation and Urban Transformation and Smart Cities Mission to drive economic growth and foster inclusive urban development”, Press Information Bureau, April 29, 2015, http://pib.nic.in/newsite/PrintRelease.aspx?relid=119925.

[xvii] “Shillong (Meghalaya) gets selected as the 100th Smart City”, Ministry of Housing and Urban Poverty Alleviation, Press Information Bureau, June 20, 2018, http://pib.nic.in/newsite/PrintRelease.aspx?relid=180063

[xviii] “Year Ender- Ministry of Housing and Urban Affairs-2018”, Ministry of Housing and Urban Affairs, Press Information Bureau, December 31, 2018, http://pib.nic.in/PressReleseDetail.aspx?PRID=1557895.

[xix] PMGSY Guidelines, Ministry of Rural Development, last accessed on October 23, 2018. http://pmgsy.nic.in/.

[xx] “Implementation of PMGSY”, Ministry of Rural Development, Press Information Bureau, December 27, 2018, http://pib.nic.in/newsite/PrintRelease.aspx?relid=186837.

[xxi] Online Management, Monitoring and Accounting System (OMMAS), Pradhan Mantri, Gram Sadak Yojana, last accessed on October 23, 2018, http://omms.nic.in/Home/CitizenPage/#.

[xxii] High Level Physical Progress Report, PMAYG, Ministry of Rural Development, last accessed on January 25, 2019, https://rhreporting.nic.in/netiay/PhysicalProgressReport/physicalprogressreport.aspx

[xxiii] “Year Ender-6-PMAY-Ministry of Housing and Urban Affairs, 2018”, Press Information Bureau, December 27, 2018, http://pib.nic.in/PressReleseDetail.aspx?PRID=1557462.

[xxiv] “Swachh Bharat Mission needs to become a Jan Andolan with participation from every stakeholder: Hardeep Puri, 1,789 Cities have been declared ODF conference on PPP model for waste to energy projects”, Ministry of Housing and Urban Affairs, Press Information Bureau, November 30, 2017, http://pib.nic.in/newsite/PrintRelease.aspx?relid=173995.

[xxv] “PM launches Swachh Bharat Abhiyaan”, Prime Minister’s Office, Press Information Bureau, October 2, 2014, http://pib.nic.in/newsite/PrintRelease.aspx?relid=110247.

[xxvi] “Individual Household Latrine Application”, Ministry of Housing and Urban Affairs, last accessed on January 30, 2019, http://swachhbharaturban.gov.in/ihhl/RPTApplicationSummary.aspx.

[xxvii] “Individual Household Latrine Application”, Ministry of Housing and Urban Affairs, last accessed on January 30, 2019, http://swachhbharaturban.gov.in/ihhl/RPTApplicationSummary.aspx.

[xxviii] Swachh Bharat Mission (Gramin), Ministry of Drinking Water and Sanitation, last accessed on January 30, 2019, https://sbm.gov.in/sbmdashboard/Default.aspx.

[xxix] “Ayushman Bharat for a new India -2022, announced”, Ministry of Finance, Press Information Bureau, February 1, 2018,s http://pib.nic.in/newsite/PrintRelease.aspx?relid=176049

[xxx] About NHA, Ayushmaan Bharat, Ministry of Health and Family Welfare, https://www.pmjay.gov.in/about-nha.

[xxxi] “Ayushman Bharat –Pradhan Mantri Jan AarogyaYojana (AB-PMJAY) to be launched by Prime Minister Shri Narendra Modi in Ranchi, Jharkahnd on September 23, 2018”, Ministry of Health and Family Welfare, Press Information Bureau, September 22, 2018, http://pib.nic.in/newsite/PrintRelease.aspx?relid=183624.

[xxxii] National Health Accounts, estimates for 2014-15 Ministry of Health and Family Welfare, https://mohfw.gov.in/newshighlights/national-health-accounts-estimates-india-2014-15.

As of April 27, 2020, there are 27,892 confirmed cases of COVID-19 in India.  Since April 20, 10,627 new cases have been registered.  Out of the confirmed cases so far, 6,185 patients have been cured/discharged and 872 have died.  As the spread of COVID-19 has increased across India, the central government has continued to announce several policy decisions to contain the spread, and support citizens and businesses who are being affected by the pandemic.  In this blog post, we summarise some of the key measures taken by the central government in this regard between April 20 and April 27, 2020.

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Source: Ministry of Health and Family Welfare; PRS.

Lockdown

Relaxation of lockdown for shops in specific areas

On April 25, the Ministry of Home Affairs passed an order allowing the opening of: (i) all shops in rural areas, except those in shopping malls, and (ii) all standalone shops, neighbourhood shops, and shops in residential complexes in urban areas.  Shops in markets, market complexes, or shopping malls in urban areas are not allowed to function.  Only shops registered under the Shops and Establishments Act of the respective state or union territory will be allowed to open.  Further, no shops can open in rural or urban areas that have been declared as containment zones.  The order also specifies that the sale of liquor continues to be prohibited. 

Functioning of Central Administrative Tribunals to remain suspended

The functioning of Central Administrative Tribunals will remain suspended until May 3, 2020.  Once functioning begins, certain days already declared as holidays may be reassigned as working days.  This decision was made keeping in mind that most of the Central Administrative Tribunals are located in COVID-19 hotspots. 

Financial measures

RBI announces Rs 50,000 crore special liquidity facility for Mutual Funds

The Reserve Bank of India (RBI) has decided to open a special liquidity facility for mutual funds (SLF-MF) worth Rs 50,000 crore.  This will ease liquidity pressures on mutual funds.  Under the SLF-MF, RBI will conduct repo operations of 90 days tenor at the fixed repo rate.  The SLF-MF will be available for immediate use, and banks can submit their bids to avail funding.  The scheme is available from April 27 to May 11, 2020, or until the allocated amount is utilised, whichever is earlier.  RBI will review the timeline and amount of the scheme, depending upon market conditions.  Funds availed under the SLF-MF can be used by banks exclusively for meeting the liquidity requirements of mutual funds.  This can be done through: (i) extending loans, and (ii) undertaking outright purchase of and/or repos against collateral of investment grade corporate bonds, commercial papers, debentures, and certificates of deposits held by mutual funds.

RBI extends benefits of Interest Subvention and Prompt Repayment Incentive schemes for short term crop loans

The Reserve Bank of India has advised banks to extend the benefits of Interest Subvention of 2% and Prompt Repayment Incentive of 3% for short term crop loans up to three lakh rupees.  Farmers whose accounts have become due or will become due between March 1, 2020 and May 1, 2020 will be eligible. 

Protection of healthcare workers

The Epidemic Diseases (Amendment) Ordinance, 2020 was promulgated 

The Epidemic Diseases (Amendment) Ordinance, 2020 was promulgated on April 22, 2020.  The Ordinance amends the Epidemic Diseases Act, 1897.  The Act provides for the prevention of the spread of dangerous epidemic diseases.  The Ordinance amends the Act to include protections for healthcare personnel combatting epidemic diseases and expands the powers of the central government to prevent the spread of such diseases.  Key features of the Ordinance include:

  • Definitions:  The Ordinance defines healthcare service personnel as a person who is at risk of contracting the epidemic disease while carrying out duties related to the epidemic.  They include: (i) public and clinical healthcare providers such as doctors and nurses, (ii) any person empowered under the Act to take measures to prevent the outbreak of the disease, and (iii) other persons designated as such by the state government.  

  • An ‘act of violence’ includes any of the following acts committed against a healthcare service personnel: (i) harassment impacting living or working conditions, (ii) harm, injury, hurt, or danger to life, (iii) obstruction in discharge of his duties, and (iv) loss or damage to the property or documents of the healthcare service personnel.  Property is defined to include a: (i) clinical establishment, (ii) quarantine facility, (iii) mobile medical unit, and (iv) other property in which a healthcare service personnel has direct interest, in relation to the epidemic. 

  • Protection for healthcare personnel and damage to property:  The Ordinance specifies that no person can: (i) commit or abet the commission of an act of violence against a healthcare service personnel, or (ii) abet or cause damage or loss to any property during an epidemic.  Contravention of this provision is punishable with imprisonment between three months and five years, and a fine between Rs 50,000 and two lakh rupees.  This offence may be compounded by the victim with the permission of the Court.  If an act of violence against a healthcare service personnel causes grievous harm, the person committing the offence will be punishable with imprisonment between six months and seven years, and a fine between one lakh rupees and five lakh rupees.  These offences are cognizable and non-bailable.

For more details on the Ordinance, please see here

Financial aid

Progress under the Pradhan Mantri Garib Kalyan Package 

According to the Ministry of Finance, between March 26 and April 22, 2020, approximately 33 crore poor people have been given financial assistance worth Rs 31,235 crore through bank transfers to assist them during the lockdown.  Beneficiaries of the bank transfers include widows, women account holders under Pradhan Mantri Jan Dhan Yojana, senior citizens, and farmers.  In addition to direct bank transfers, other forms of assistance have also been initiated. These include

  • 40 lakh metric tonnes of food grains have been provided to 36 states and union territories. 

  • 2.7 crore free gas cylinders have been delivered to beneficiaries.

  • Rs 3,497 crore has been disbursed to 2.2 crore building and construction workers from the Building and Construction Workers’ Funds managed by state governments. 

For more information on the spread of COVID-19 and the central and state government response to the pandemic, please see here.