The 89th Union Budget 2019-20 has been recently presented by Finance Minister, Smt. Nirmala Sitharaman (the Minister) on 05-07-2019. The Government has planned to invest Rs 100 Lakh Crore in infrastructure over next 5 years.

Focusing on the infrastructure sector, the Minister has proposed several measures with a vision for the next 5 years for the development of infrastructure sector. The highlights of such measures are as follows:

  • Under the Pradhan Mantri Gram Sadak Yojana:

The Bharatmala Programme: It would help develop national road corridors and highways

The Sagarmala Programme: It would enhance port connectivity, modernization and port-linked industrialization.

The Jal Marg Vikas Project: It aims at smoothening internal trade carried out through inland water transport and at reducing the cost of transportation through waterways.

The Ude Desh Ka Aam Nagrik (UDAN) Scheme: It would make way for cheaper air travel and also, connect remote parts of the country.

  • The Metro Rail Projects: Out of a total route length of 300 kilometers approved during 2018-19, about 210 kms metro lines have been operationalized in 2019.
  • Incentives for advanced battery and registered e-vehicles:

GST rate on electric vehicles is proposed to be lowered from 12% to 5%

Proposed additional income tax deduction of INR 1.5 Lakh on the interest paid on loans taken to purchase electric vehicles. Provided the loan has to be taken on or before 31-03-2023

Customs duty would be exempted on certain parts of electric vehicles such as e-drive assembly, on board charger, e-compressor, charging gun

  • Roadways: Comprehensive restructuring of National Highways and development of State road networks. Further, the Government has proposed to increase Special Additional Excise duty and Road and Infrastructure Cess each on petrol and diesel from Rs 8 per litre to Rs 9 per litre.
  • Waterways: Movement of cargo on River Ganga to increase four times with the construction of two more terminals at Sahibganj and Haldia
  • Water supply: Jal Shakti Mantralaya to focus on creation of local infrastructure including rainwater harvesting, groundwater recharge and management of household wastewater for reuse in agriculture
  • Railways: Proposal to use Public-Private Partnership to hasten the process of development and completion of tracks, rolling stock manufacturing and delivery of passenger freight services.
  • Power connectivity: Proposal to implement One Nation, One Grid that would ensure power availability to states at affordable rates

Thus, the Government has aimed at increasing investments for the development of the aforesaid infrastructure sector and also other sectors including digital economy, job creation in small and medium enterprises, and water management in India.

Harini Daliparthy

Senior Legal Associate

The Indian Lawyer

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