Epic Research Private Limited ‎Budget Simplified‬ Version of the Union ‪‎Budget 2015-16. This report includes all the highlights and overview of the union budget as well as Railway Budget of India.

1. 1
BUDGET 2015-16
Budget simplified
Laying the foundation for Vibrant India

2. 2
KEY HIGHLIGHTS OF BUDGET 2015-16
 CAD to be below 1.3% of GDP, based on new growth calculator FY15 real GDP is expected to be
7.4%.
 Fiscal Deficit target for FY15-16 is 3.9% and to 3.5% and 3% in next two years respectively.
Revenue deficit to be 2.8% of GDP
 CPI to reduce to 5.1% by year end, FOREX reserves increased to $340 billion.
 Introduction of Gold Monetization Scheme with fixed interest rate and redeemable in cash to
curb imports.
 Corporate Tax rate to be reduced to 25% from current 30% in next four years, starting next year
while withdrawing the subsidies.
 Abolishing of wealth tax with additional surcharge of 2% on super rich with annual income over
1 Cr.
 Hike in Service Tax from 12.36% to 14%, followed by hike in Excise Duty to 12.5% from 12%
Budget Estimates
 Planned Expenditure– 4,65,277 Cr; Non Planned Expenditure– 13,12,200 Cr
 Expenditure on defense for FY15-16: 2,46,727 Cr
 Gross total receipts estimated at 14,49,490 Cr
 Devolution to states estimated at 5,23,958 Cr
 Share of Central Government 9,19,842 Cr
 Non– Tax Revenues for next fiscal are estimated to be 2,21,733 Cr
OVERVIEW
Infrastructure
Investment in infra has been increased by Rs 70,000 Cr for year 15-16. For roads and railways, the
budgetary allocation has been increased by Rs 14,031 Cr and Rs 10,050 Cr respectively with
additional benefit by introducing tax free infra bonds for projects in railways, roads and irrigation
sector. Emphasis on developing National Investment and Infrastructure Fund (NIIF). With this, REITS
would be able to attract funds worth Billions as the rental income held under REITS to be directly
taxed in hands of unit holder.
Steel
Hike in custom duty on iron ore, steel products favor domestic consumption and prevent from
cheap imports. All this will favor the domestic steel company fight the Chinese counterpart. This will
kick start the infrastructure and create demand for cement as well. Investment of Rs 22,407 Cr
under MGNREGA for housing and urban development. ‘Housing for all’ by 2022 would call for 2 Cr
houses in urban and 4 Cr in rural areas with access to all basic amenities.
Budget 2015-16
2 March 2015
Fundamental Report By Epic Research www.epicresearch.co
Jayesh Tare, Analyst
jtare@epicresearch.in
Vrinda Aditya, Analyst
vaditya@epicresearch.in
Analyst
GDP at 7.4% looks
tremendous seeing the
dismal performance in
past two years

3. 3
Auto and Auto ancillary Industry
Being a key manufacturing industry, automobile and auto ancillary received little surprises from
budget 2015-16. Along with progress of this sector, eco system is to be cared. For the same, GOI will
launch scheme for Faster Adoption and manufacturing of Electric Vehicles (FAME) with initial invest-
ment of Rs.75 Cr for the year. The concessions from customs and excise duties currently available on
specified parts for manufacture of electrically operated vehicles and hybrid vehicles are being ex-
tended by one more year i.e. up to 31.3.2016.
In respect to Custom duty tariff rate on Commercial Vehicles (more than ten seater) has been
increased from 10% to 40% and effective rate from 10% to 20%. However, customs duty on
commercial vehicles in Completely Knocked Down (CKD) kits and electrically operated vehicles
including those in CKD condition will continue to be at 10%.
Oil-Gas and Power
While earlier the states used to be rewarded only in terms of loyalty, but with the transparency in
coal block allocation, the states will be rewarded with much higher surplus. Centre also proposes to
set up five new UMPP, 4000 MW each with clean energy. Second unit of Kudankulam Nuclear Power
Station is to be commissioned in 15-16.
Green India Initiative
The Ministry of New Renewable Energy has revised its target of renewable energy capacity to
1,75,000 MW till 2022, comprising 100,000 MW Solar, 60,000 MW Wind, 10,000 MW Biomass and
5000 MW Small Hydro. Depreciation of 10% is allowed on new plant and machinery is allowed by
any manufacturing facility. Electrification, by 2020, of the remaining 20,000 villages in the country,
including by off-grid solar power generation.
Increase in basic custom duty of Metallurgical coal from 2.5% to 5%.
Information Technology
IT accounts for 38% of India’s services export. The Digital India campaign fosters to make India a
knowledge & innovation based society with Broadband connectivity being taken to all villages. to
initiatives for young Entrepreneurs reduce the rate of income tax on royalty and fees for technical
services from 25% to 10% to boost their confidence.
The National Optical Fibre Network Programme (NOFNP) of 7.5 lakh kms. networking 2.5 lakh
villages is being further speeded up by allowing willing States to undertake its execution.
Banking and NBFC
An Autonomous bank Board Bureau is proposed to be set up to help Public Sector banks in devel-
oping differentiated strategies and capital raising plans through innovative financial methods and
instruments. To bring parity in regulation of Non-Banking Financial Companies (NBFCs) with other
financial institutions in matters relating to recovery, it is proposed that NBFCs registered with RBI
and having asset size of Rs 500 Cr and above will be considered for notifications as ‘Financial Institu-
tion’ in terms of the SARFAESI Act, 2002.
Budget 2015-16
Fundamental Report By Epic Research www.epicresearch.co
Reducing carbon credits while
maintaining the same growth
rate is challenging
Renewable sources of
energy to be the next big
thing
Banking to provide major role
for investments and nurturing
India

4. 4
Agriculture
Agriculture contributes around 8% in GDP. An ambitious Soil Health Card Scheme has been launched
to improve soil fertility on a sustainable basis. Rs.5,300Cr has been allocated to support micro-
irrigation, watershed development and the Pradhan Mantri Krishi Sinchai Yojana. Investments of
Rs.25000 Cr in the year in Rural Infrastructure Development Fund (RIDF) set up in NABARD,
Rs.15,000Cr for Long Term Rural Credit Fund,Rs.45,000Cr for Short Term Cooperative Rural Credit
Refinance Fund and Rs.15,000Cr for Short Term RRB Refinance Fund and an ambitious target of
Rs.8.5 lakh Cr of credit during the year 2015-16 , are all lined up for farmers and their betterment. Rs
34,699Cr has been allocated for employment generation under MGNREGA.
A Unified National agriculture Market will be set up along with States under NITI, to provide benefit
of moderating price rises of commodities to farmers, increasing their participation and create aware-
ness in trade. Further, Micro Units Development Refinance Agency (MUDRA) Bank, with a corpus of
Rs.20,000 Cr and credit guarantee corpus of Rs 3,000 Cr will be created. Interest of farmers are tak-
en care of with extended facilities for credit, life cover insurance, pension scheme to provide safety
of life. Government also proposes to increase an addition 10% on Urea Freight duty.
Duties and Taxation
Introduction of GST to help Government control goods coast and ease businesses. As for the com-
mon man, the income tax slab has been unchanged, while a reduction in corporate tax buy 5% to
25% has been done. GAAR to implemented after two years.
To curb Black money, heavy tax regime of 300% shall be levied upon. Removal of tax exemptions by
means of small but proper governance. Tax “pass through” to be allowed to both category I and
category II Alternative Investment funds.
Rate of Income tax on royalty and fee for technical services reduced from 25% to 10% to facilitate
technological inflow. Removal of MAT for FII and members of AOP.
100% deductions for contribution made towards Swatch Bharat Kosh and Clean Ganga fund.
Increase in excise duty for sacks and bags made of polymers of ethylene other than industrial use.
Benefits to Middle class Tax Payers
Limit of deduction of health insurance Premium from 15,000 to 25,000 and for senior citizens to
30,000 Rs. Super seniors have been exempted. Limit on deduction on contribution to NPS increased
to Rs 1.5 lakh. Additional deduction of Rs 50,000 under NPS u/s 80CCD. Removal of capital Gain Tax
for MF investment for merger of schemes.
 Excise duty on mineral water and aerated drinks have been increased to 18%.
 Phone bills are expected to go up.
Budget 2015-16
Fundamental Report By Epic Research www.epicresearch.co
Agriculture forms the
backbone and needed to
be taken care with all
facilities
Tax initiatives appear to be
Mix bag for country

5. 5
HIGHLIGHTS FROM RAILWAY BUDGET
Scope and Investments
It is aimed that daily passenger carrying capacity will increase to 30 million and Freight carrying
capacity to 1.5 billion tn in next 5 yrs, to be supplemented by Rs 8.5 lakh Cr investments. Railway
Plan size increased by 52% to Rs 1.11 lakh Cr for FY16; 41.6% GBS; 17.8% internal generation. Gross
budgetary support from Govt Pegged At Rs 40,000 Cr with market Borrowing Of Rs 17,655 Cr For
FY16. Allocation of Rs 1.93 lakh Cr on Network and Rs 1.02 lakh Cr on Rolling Stock for next
5years .Coastal connectivity program this year at a cost of Rs 2,000 Cr. To Spend Rs 96,182 Cr on
capacity expansion In FY16 to expand capacity of 9,420 kms rail lines. To move to EPC model for all
railways projects. To revamp PPP cell to make it more result-oriented. It estimated to have
Operating Ratio Of 88.5% For FY16 Vs 91.8% FY15.
Fare
There is no hike in passenger fares as was expected by common man. Although Freight rates
increased as follows: 0.8% for LPG, 2.7% for slag, 0.8% for kerosene, 3.1% for Scrap & Pig iron
6.3% for Coal, 10% for Urea, and 2.7% for Cement. Freight rates lowered by 0.3% for Limestone &
Manganese and 1% for high speed diesel
Railway Tracks
Increasing the condition of tracks from current scenario, Government aims to spend Rs 6,581 Cr on
Level crossing safety, Rs 120 Cr for lifts, escalators in FY16. Train protection warning system and train
collision avoiding system. North-East connectivity to be improved, J&K connectivity also in fo-
cus.130% increase in railway electrification over previous year. 6,000 km to be electrified in 2015-16
compared to 462 km in 2014-15. Speed of 9 corridors to be increased from 110-130 km/hr to 160-
200 km/hr.
Stations
It is proposed to revamp the station re-development scheme. 200 more stations to come under
Adarsh Station scheme. Open wi-fi to be available at 400 railway stations. 24 x7 Helpline Number
138 to be a National Railway number; 182 – toll free for Security related calls. Passengers without
reservation can book tickets within 5 minutes of boarding train. Increasing reservation time from 60
days to 120 days. SMS Alert Service for Train Arrival, Departure Times. To have Integrated Customer
Portal for passengers to get all railways related information at one click along with a multi lingual e
portal. Full fledged university for railways during 15-16. Skill development and self employment to
be encouraged on Konkan Railway model.
FMCG
Budget had a positive impact on the industry with revised excise and custom duty in various com-
modities. Exemptions of Education Cess and Secondary & Higher Education Cess leviable on excisa-
ble goods. Excise duty on cigarettes is being increased by 25% and 15% for various categories. Excise
duty on footwear having retail price of more than Rs1000 per pair has been reduced to 6% from
12%. 22 items which are considered as raw materials has been exempted from custom duty.
Budget 2015-16
Fundamental Report By Epic Research www.epicresearch.co
Hefty Investments in rail to
improve connectivity
Laying of new lines while
replacing the old ones
Modernization of stations to
match foreign standards

6. 6
Budget 2015-16
Fundamental Report By Epic Research www.epicresearch.co
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