New Delhi: Finance Minister Pranab Mukherjee presents General Budget 2011-12 in Lok Sabha

Points of the budget speech of FM:
Total food inflation down from 20.2 per cent last year to 9.3 per cent in Jan; still a matter of concern
The Government has to reconcile ecological concerns with development aspirations
Corruption is a problem which we have to fight collectively
I see Budget 2011-12 as transition towards more transparent and result-oriented economic management.
Stronger fiscal consideration needed
Will address policy constrains
Economy resilient to external stocks
Service sector growing in double digit
High current account deficit a cause of concern
Economic growth in 2011-12 likely to be 9 per cent
Current account deficit and average inflation in 2011-12 likely to be less than current year
Public Debt Management Agency Bill to be introduced next financial year
Direct Tax Code Bill likely to be passed by Parliament next financial year after getting Standing Committee report
Goods and Services Tax Bill to be introduced in Parliament this year
Govt to move towards direct cash transfer of cash
Government to keep up tempo of disinvestment process
Portfolio investment would be permitted in SEBI registered mutual funds from foreign subscriptions
Financial sector reforms to move forward; Insurance Amendment Bill, LIC Bill and Pension Development Authority Bill, Banking Laws Amendment Bill, SBI Subsidiaries Bill and BIFR Bill in current session
Rs 6,000 cr to be given to public sector banks to maintain capital-to-risk assets ratio norms
Indian micro finance equity with SIDBI to be formed at Rs 100 crore
Proposal to increase rural housing fund to Rs 3,000 crore
Budget proposes to raise housing loan limit from Rs 20 lakh to Rs 25 lakh from priority sector lending
Government plans to create a Women Self Help Group development fund with a corpus of Rs 500 crore
Allocation under Rashtriya Krishi Vikas Yojana to be raised from Rs 6755 crore in the current year to Rs 7860 crore
Rs 300 cr provided to promote pulses cultivation in rain-fed areas, another Rs 300 cr to promote farm product cultivation
Credit flows to farmers raised from Rs 3.75 lakh crore to Rs 4.75 lakh crore
Government proposes to promote organic farming methods to enable farmers get best from their land
Existing interest subvention scheme on short term farm loans at seven percent interest to continue
NABARD capital base to be strengthened; Rs 10,000 cr to be provided to it as short term credit fund
Tax free bonds of Rs 30,000 cr to be issued for infrastructure development. This will cover Warehousing Corporation, NHAI, IRFC and HUDCO
Capital investment in fertiliser production to be considered as infrastructure sub-sector
A new scheme to be introduced for refund of service tax on lines of drawback of duties

Proposal to introduce self-assessment of customs duty wherein importers and exporters will themselves assess payment of duty

Remuneration of anganwadi workers raised from Rs 1500 to Rs 3,000 per month. Helpers to get Rs 1,500 from Rs 750
Rs 50 cr grant to Aligarh Muslim University centres in Murshidabad in West Bengal and Malappuram in Kerala
Old age pension to persons of over the age of 80 raised from Rs 200 to Rs 500
Budget allocation of Rs 100 cr for Ladakh and Rs 150 cr for Jammu for implementation of projects identified by taskforce
Rs 9 lakh compensation to be given to men of defence, central paramilitary forces for permanent disability and discharged from service

Rs 300 cr to be provided as assistance to states for modernising and stamps and registration administration
Budget estimates for 2011-12 projects Rs 9,32,440 crore - an increase of 24 per cent
Net tax to Centre will be Rs 6,64,457 crore. Non-tax receipts pegged at Rs 1,25,435 crore
Fiscal deficit brought down from 5.5 per cent to 5.1 per cent in 2010-11. In 2011-12, it will be 4.6 per cent
Total plan expenditure will go up 100 per cent in nominal terms in the next year
Revenue deficit fixed at 2.3 per cent in revised estimates of 2010-11 and 1.8 per cent in 2011-12
Threshold income tax limit raised from 1.6 lakh to 1.8 lakh
Exemption limit to senior citizens above 80 increased to Rs 5 lakhs
Extension of investment on long-term infrastructure bonds by one more year
Investment-linked deductions for fertilisers and developers of affordable housing
Eligibility age for senior citizens for tax exemptions reduced to 60 from 65 years
Net loss from direct tax proposals estimated at Rs 11,500 crore
Central government debt in proportion to GDP will be 44.2 per cent in 2011-12.
Standard rate of central exercise duty maintained at 10 percent
No change in CENVAT rates
Nominal one per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted
Peak rate of customs duty maintained at 10 per cent in view of the global economic situation.
Basic customs duty on agricultural machinery reduced to 4.5 per cent from 5 per cent
Basic customs duty on raw silk reduced from 30 to 5 per cent
Export duty rates on iron ore unified and kept at 20 per cent ad valorem
Excise and customs duty proposals to result in the net gain of Rs 7,300 crore
Service tax widened to cover hotel accommodation above Rs 1,000 per day, A/C restaurants serving liquor, some  ategory of hospitals, diagnostic tests
Service tax on air travel increased by Rs 50 for domestic travel and Rs 250 for international travel in economy class. On higher classes, it will be ten per cent flat
Some legal services to be brought under service tax net. Service by an individual to another individual exempted
Net revenue loss on account of taxes and duties will be Rs 200 crore
Service tax to result in a revenue gain of Rs 4,000 crore
Net revenue loss on account of direct taxes will be Rs 11,500 crore. Net revenue gain on account of indirect taxes will be Rs 11,300 crore

(Agencies)

 

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