Union Budget Analysis 2022-23: A Complete Overview

10 min read • Updated 28 November 2022
Written by Animesh Gupta
Union Budget Analysis

The Union Budget is India’s comprehensive budget, presented annually in February by the Union Finance Minister. Article 112 of the Indian Constitution says that it is a statement of the estimated Government expenditure and receipts for a particular financial year. It is also known as the Annual Financial Statement.

The budget keeps an account of the Central Government’s finances for the fiscal year from April 01 to March 31. It is presented on February 01 every year in the Lok Sabha to materialise the budget before the commencement of the new financial year, which starts on April 01. 

Let us analyse the Union Budget for 2022-23 in detail!

Top Economic Indicators under Union Budget 2022-23

An economic indicator helps in economic activity analysis that produces predictions about an economy’s future performance. The top economic indicators of the Union Budget 2022-23 are as follows:

  • Growth Rate Estimates

India’s economic growth in the financial year 2022-23 is 9.2% of GDP (Gross Domestic Product), the highest among all large economies. The projected economic growth for the financial year 2023-24 is estimated to be 8-8.5% of GDP.

  • Capital Expenditure

The outlay for capital expenditure has been increased by 35.4% of GDP in the year 2022-23. It was initially around Rs. 5.54 lakh crore and increased to Rs. 7.50 lakh crore in the current financial year of 2022-23.

  • Fiscal Deficit

The revised Fiscal Deficit in the year 2022-23 is estimated at 6.9% of GDP as against the projected 6.8% in the Budget Estimates.

However, the Fiscal Deficit was targeted at 6.4% of GDP, consistent with a broad fiscal path announced last year. Last year, it was estimated to reach a fiscal deficit below 4.5% by 2025-26.

Furthermore, the Revenue Deficit for 2022-23 is estimated at 3.8% of GDP, which is much lower than the revised estimate of 4.7% in 2021-22.

  • Repo Rate

The repo rate has been kept unchanged at 4% by the RBI since May 2020. It is currently continuing with an accommodative monetary policy stance.

  • Inflation

CPI (Consumer Price Index) was averaged at 5.2% in the previous year for the year 2022-23. However, it was driven primarily by food and high fuel prices in the current financial year. The exact estimated percentage of inflation needs to be mentioned accurately.

  • FDI (Foreign Direct Investment)

The net FDI inflows amounted to USD 24.7 billion in April – November 2021, which is 29.5% lower than the previous years’ FDI. However, FDI of the current financial year is not yet determined.

  • Merchandise Exports

Merchandise exports expanded by 49.7% to USD 301.4 billion compared to pre-pandemic levels in April – December 2021. However, merchandise export for the current year 2022-23 is to be determined yet.

Significant Announcements under Various Sectors of Union Budget 2022-23

The significant announcements and changes made under various sections of the Union Budget 2022-23 are:


  • Measurements are taken on 5G spectrum auctions, which are to be conducted in 2022.
  • PM Gati Shakti National Master Plan has been initiated at the cost of Rs. 20,000 crore.
  • Work on laying optical fibre in rural areas has been started, which will hopefully get completed by 2025.
  • Design-led manufacturing schemes for 5G will be a part of the production-linked scheme.
  • Allocation of an additional amount of Rs. 195 billion for manufacturing solar equipment under production-linked incentives.


  • The National Tele Mental Health program is to be set up to focus on mental health.
  • National Digital Health Ecosystem to be rolled out in the current financial year.
  • 23 tele mental health centres of excellence are to be built for mental health care.
  • Integrated health benefits to women and children through Mission Vatsalya, Mission Shakti, Saksham Anganwadi and Poshan 2.0.


  • Upgrading 2 lakh Anganwadis to improve child health.
  • Establishment of a digital university for online education on the basis of a networked hub and spoke model.
  • One Class, One TV channel to be expanded from 12 to 200 TV Channels to provide supplementary education in all regional languages.
  • Select ITIs in all states to offer skilling courses.


  • A domestic scheme has been introduced to reduce dependence on oilseed imports.
  • Chemical-free natural farming is to be promoted in the current financial year across the country.
  • NABARD will facilitate funds with blended capital to finance start-ups for rural and agricultural enterprises.
  • The year 2022 is supposed to be the year of millet. Therefore, the Government has initiated extensive support for post-harvest value addition for millet products.
  • Using Kisan drones for crop assessment and spraying of pesticides. 
  • The Government will deliver hi-tech services for farmers.
  • Farmers will get MSP directly into their bank accounts.


  • The long-term capital gain surcharge is to be capped at 15%.
  • A public issue of Life Insurance Corporation is to be expected shortly.
  • Emergency Credit Line Guarantee Scheme (ECLGS) for small and medium-sized businesses is to be extended till March 2023.
  • The bankruptcy code will be amended to speed up the resolution process.


  • 68% of the capital procurement budget in this sector will be earmarked for domestic industry in 2022-23.
  • Budget allocation for defence production would give a push to self-reliance as a part of the Atma Nirbhar Bharat initiative.
  • Encourage private industries to design and develop military platforms and equipment.


  • The Government will roll out the Raising and Accelerating MSME Performance (RAMP) programs with Rs. 6000 crore outlay spread over MSMEs for 5 years.
  • The revamp of CGTMSE will be an added incentive for banks to extend lending in MSMEs.
  • ECLGS, which provided additional credit to over 1.3 crore MSMEs, will be extended till March 2023. This will come with a guaranteed cover to expand by Rs. 50,000 crore to Rs. 5 lakh crore.
  • ECIGS has helped 130 lakh MSMEs mitigate the worst impact of the pandemic. FM announced extension of ECLGS till Mar-23, given that nearly 95% of ECLGS borrowers are MSMEs. This measure will ensure the continuous holding of MSMEs and their services sector.
  • Another phase of ease of doing business and living has been launched.
  • The Government is taking measures to make MSMEs more competitive and resilient.


  • 2000 kilometres of railway network will be brought under Kavach as part of the PM Gati Shakti Master plan
  • The development and manufacturing of 400 new-generation Vande Bharat Trains with better passenger riding experience and energy efficiency will occur during the next three years.
  • New rail products in the form of ‘One Station – One Product’ and 100 PM Gati Shakti cargo terminals over the next three years after the integration of NIP with Gati Shakti.

Roadways, Waterways and Logistics

  • PM Gati Shakti Master Plan for expressways will be formulated in the upcoming financial year.
  • DPR construction drafts for five river links have been finalised.
  • Four multi-modal national park contracts will be awarded in the financial year 2022-23.

Housing and Basic Amenities

  • Rs. 60,000 crore has been allocated for providing access to tap water to 3.8 crore households. 
  • Identification of 80 lakh households under the affordable household scheme to take place in 2022-23. 
  • The Government will initiate the Ken-Betwa link project at Rs 44,605 crore to provide irrigation to 9.05 lakh hectares and drinking water, hydro and solar power to 65 lakh people.
  • The increasing value of infra spends needs to be clarified through PM Gati Shakti Plan, unlike the apparent 34.5% increase to Rs 5.5 lakh crore last year.


  • Production Linked Incentive (PLI) Scheme for achieving Aatmanirbhar Bharat will produce Rs. 30 lakh crore jobs during the next five years.
  • PLI schemes across 14 sectors have achieved an excellent response for creating 60 lakh new job opportunities.

Tax Policy Highlights of Union Budget 2022-23

The tax policy highlights of Union Budget 2022-23 are as follows:

  • Income Tax

There is no change in income tax rates for corporations and individuals.

  • Custom duty changes

Customs duties on over 500 items have changed, and many customs exemptions have been phased out.

  • Revised income tax return policy

Taxpayers have a two-year window to correct errors and file a revised income tax return for the relevant assessment year.

  • Tax holiday

Tax holidays for start-ups incorporated up to March 31 2023, and for new companies commencing operations by March 31 2024, are extended.

  • Surcharge or cess
  • The surcharge on LTCG on listed equities and equity mutual funds is capped at 15%.
  • Surcharges on other LTCGs are 25% if total income is between Rs. 2 crore and Rs. 5 crore. However, this is 37% if it is above Rs. 5 crore.
  • There is a retrospective amendment to deny deduction of any surcharge or cess paid on income and profits.
  • Virtual Digital Assets (VDA)
  • Gains will be taxed at 30%, and deductions will be allowed only for the cost of acquisition.
  • Introduction of 1% tax deduction at source (TDS), which will have applicable deemed gift tax provisions. 
  • The benefit of set-off and carry forward of losses will not be available.
  • International Financial Services Centre (IFSC)
  • The transfer of specific derivative instruments will provide an income for a non-resident.
  • Income-tax exemption on IFSC units is expanded to specific income of non-residents. 
  • Concessional tax regime

The Government will withdraw concessional tax regime on foreign-sourced dividends from the financial year 2022-23.

  • Alternate minimum tax

Cooperative societies pay an 18.5% alternate minimum tax, whereas companies pay 15% of the same. However, from this financial year, the cooperatives too will have to pay only a 15% alternate minimum tax.

Top Policy Highlights of Union Budget 2022-23

The top policy highlights of Union Budget 2022-23 are as follows:

  • Multi-modal Connectivity
  • Enhanced multi-modal connectivity through roadway expansion by 25,000 km.
  • The Government is developing 100 cargo terminals and 8 ropeway projects.
  • 2000 km of rail network under indigenous technology.
  • Insolvency and Bankruptcy Code Amendments
  • To enhance the resolution process, including for cross-border insolvency.
  • To establish a centre for reducing voluntary winding up process of companies by up to six months.
  • International Arbitration Centre

Setting up International Arbitration Centres and permitting foreign universities to operate in Gujarat International Finance Tec (GIFT) City. 

  • Digital Rupee
  • Launch of digital rupee using blockchain and other technologies in the financial year 2022-23.
  • 75 digital banking units (DBUs) to be set up by scheduled Commercial Banks.
  • Empowerment of women

The Government introduced schemes such as Mission Shakti, Mission Vatsalya, Saksham Anganwadi and Poshan 2.0 to ensure women empowerment throughout the various sections of society. 

Final Word

In the last few years, the Government has ensured unprecedented focus on infrastructure through a holistic outlook. A union budget helps in addressing these issues for a significant infrastructure project. Additionally, a change in the Union budget has helped overcome the lack of coordination between different sectoral departments. 

Frequently Asked Questions

What is PM Gati Shakti National Master Plan?

The PM Gati Shakti National Master Plan is a digital platform to bring 16 Ministries together for integrated planning and implementation of infrastructure connectivity projects. This multimodal connectivity will provide seamless connectivity for movement of people, goods and services from one mode of transport to another.

What is a PLI scheme?

A Production Linked Incentive (PLI) scheme boosts investments, domestic manufacturing and export of telecom and networking products in the Department of Telecommunications (DoT). It was launched on February 01 2021, with an overall budget of Rs. 12,195 crore for 5 years.

What is Saksham Anganwadi?

Saksham Anganwadi is an operational guideline issued by the Ministry of Women and Child Development for the overall development of women and children. It seeks to address and eradicate malnutrition among children (up to 6 years), adolescent girls (14-17 years) and pregnant or lactating women.

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Animesh Gupta

Credit Principal
Animesh Gupta is a Chartered Accountant by profession and a NISM certified Mutual Fund Expert. He has over 5+ years of experience working in the Financial Services Industry. In his role at Wintwealth, he is part of the Credit and Risk team and evaluates the risk of the bonds available on Wintwealth's platform.

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