New Delhi, February 28: Finance minister Pranab Mukherjee is presenting Union Budget 2011 in Parliament.
The finance minister opened his speech with reference to inflation saying that food inflation came down from 20.2% last year to 9.3% in January 2011 but it was still a matter of concern. “Government’s principle concern is high food prices… food prices were high for cereals, there was a spurt in prices of onions and milk,” he said. ( Inflation remains principal concern, to fall next year )
In may be a big relief for farmers, the FM said credit flows to farmers will be raised from Rs 3.75 lakh crore to Rs 4.75 lakh crores and the allocation under Rashtriya Krishi Vikas Yojana will be raised from Rs 6755 crore in the current year to Rs 7860 crore.
An additional Rs 300 cr will be provided to promote pulses cultivation in rain-fed areas and another Rs 300 cr to promote farm product cultivation.
In joy for anganwadi workers, their remuneration is being raised from Rs 1500 to Rs 3,000 per month. Anganwadi helpers will get Rs 1,500 from Rs 750, Pranab said.
The FM announced that Direct Tax Code will be implemented from April, 2012 and the Goods and Services Tax Bill is to be introduced in Parliament this year. ( Direct Taxes Code to be implemented from April 1, 2012 )
He also announced benefits for Below Poverty Line families by allowing direct transfer of subsidies in kerosene and LPG for such individuals.
There is a proposal to introduce self-assessment of customs duty wherein importers and exporters will themselves assess payment of duty.
A new scheme is to be introduced for refund of service tax on the lines of drawback of duties, he announced. Also, capital investment in fertiliser production will be considered as infrastructure sub-sector, Pranab said.
Tax-free bonds of Rs 30,000 cr will be issued for infrastructure development which will cover Warehousing Corporation, NHAI, IRFC and HUDCO. NABARD capital base to be strengthened, Rs 10,000 cr to be provided to it as short term credit fund.
Referring to environmental issues, Pranab said the government has to reconcile ecological concerns with development aspirations.
Predicting growth patterns over the next fiscal, Pranab said the overall economic growth in the current fiscal was expected at 8.6 %, agriculture growth at 5.4 %, industry at 8.1 % and services 9.3 %. In the next fiscal, economic growth was likely to be 9%, he said.
Pranab said India raised foreign institutional investor limit in 5-year corporate bonds for investment in infrastructure by $20 billion.
The government, he said, aims to provide Rs 201.5 billion capital infusion in state-run banks in 2011-12 and Rs 3 billion for 60,000 hectares under palm oil plantation
“I see Budget 2011-12 as transition towards more transparent and result-oriented economic management,” he said adding that stronger fiscal coordination was needed.
He said that corruption continued to be deterrent in the country’s development and had to be fought extensively.
Pranab Mukherjee said the government plans to create a Women Self Help Group development fund with a corpus of Rs 500 crore. There is also a proposal to increase rural housing fund to Rs 3,000 crore.
He announced the formation of Indian micro finance equity with SIDBI at Rs 100 crore. Another Rs 6,000 cr will be given to public sector banks to maintain capital-to-risk assets ratio norms, he said.
-PTI