Showing posts with label BUDGET. Show all posts
Showing posts with label BUDGET. Show all posts

Monday, July 21, 2014

Highlights of the Union Budget 2014-15

Here are the highlights of the Budget 2014-15 presented by Finance Minister Arun Jaitley.


Fiscal deficit
● Accepts fiscal deficit target of 4.1 percent of GDP for 2014/15
● Fiscal deficit seen at 3.6 percent of GDP in 2015/16
● Finance Minister says: "We cannot spend beyond our means"
● Tax-to-GDP ratio must be raised

Growth
● Aims for sustained growth of 7-8 percent in the next 3-4 years
● Finance minister says he is bound to usher in policies for higher growth, lower inflation

Taxation
● Aims to approve goods and services tax by end of this year
● Will not change rules on retrospective taxation
● All pending cases of retrospective tax for indirect transfers to be examined by a high-level committee before action is taken
● Proposes changes in transfer pricing mechanism
● Extends 5 percent withholding tax on corporate bonds until June 30 2017
● Income tax exemption limit raised by Rs 50,000 to Rs 2.5 lakh and for senior citizens to Rs 3 lakh
● Government expects Rs 9.77 lakh crore revenue crore from taxes
● Long term capital gain tax for mutual funds doubled to 20 per cent; lock-in period increased to three years
● Excise duty on footwear reduced from 12 per cent to 6 per cent
● Net effect of direct tax proposals is revenue loss of Rs 22,200 crore
● Tax proposals on indirect tax front would yield Rs. 7,525 crore

Investment
● Raises limit on foreign direct investment in defence sector from 26 per cent to 49 per cent; raises FDI limit in insurance sector to 49 percent
● Earmarks Rs 7000 Crore to create 100 "smart cities"
● Will provide the necessary tax changes to introduce real estate investment trusts and infrastructure investment trusts
● Proposes Rs 4000 crore for affordable housing through national housing bank and extends tax incentives for housing loans
● Exemption limit for investment in financial instruments under 80C raised to Rs 1.5 lakh from Rs 1 lakh.
● Investment limit in PPF raised to Rs 1.5 lakh from Rs 1 lakh
Foreign direct investment
● Raises limit on foreign direct investment in defence sector from 26 percent to 49 percent
● Raises FDI limit in insurance sector from 26 percent to 49 percent

Spending
● Capital outlay for defence raised by 50 billion rupees over interim budget
● Earmarks Rs 7000 crore to create 100 "smart cities"
● Proposes Rs 5000 crore for warehousing capacity; 100 billion rupees of private capital for start-up companies; and 378 billion rupees of investment in national and state highways
● Rs 4000 crore for affordable housing proposed through national housing bank and extends tax incentives for housing loans
● Proposes Rs 8000 crore for rural housing scheme

Subsidies
● Plans to make food and petroleum subsidies more targeted
● Rural job-guarantee scheme, which provides 100 days of paid employment a year, will become more focused on asset creation
● Proposes Rs 8000 crore for rural housing scheme

Agriculture
● Will focus on achieving 4 growth per year in agriculture
● Proposes a long-term rural credit fund with an initial corpus of Rs 5000 crore
● Rs 100 crore for development of organic farming

Social sector
● Pension Scheme to be revived for a year (Aug 15-14) for citizens above 60
● Rs 50,548 crore for SC welfare schemes.
● Rs 32,387 crore for ST welfare schemes.

Infrastructure
● Earmarks Rs 500 crore for 24x7 uninterrupted power in all homes
● Rs 100 crore for metro projects in Lucknow and Ahmedabad
● Rs 2,037 crore set aside for Integrated Ganga Conservation Mission called 'Namami Gange'
● Rs 200 crore for world-class sports stadium in Jammu and Kasmir
● Trade Facilitation Centre in Varanasi Handloom and Crafts Museum
● Rs 1000 crore to enhance rail connectivity in the Northeast
● Rs 2250 crore for the development and modernization of the border infrastructure
● A project on the river Ganga called 'Jal Marg Vikas' for inland waterways between Allahabad and Haldia; Rs 4,200 crore set aside for the purpose
● War memorial to be set up along with a war museum; Rs 100 crore set aside for this
● Rs 7,060 crore for setting up 100 Smart Cities

Education
● Five more IIMs to be opened in HP, Punjab, Bihar, Odisha and Rajasthan
● Five more IITs in Jammu, Chattisgarh, Goa, Andhra Pradesh and Kerala.
● Four more AIIMS like institutions to come up in Andhra Pradesh, West Bengal, Vidarbha in Maharashtra and Poorvanchal in Uttar Pradesh

Tourism
● E-Visas to be introduced at 9 airports
● Finance Minister says tourism helps in job creation and e-visas will encourage more tourists to visit India
● A provision of Rs 500 crore for five tourism sector.

Banking
● Deduction limit on interest on loan for self-occupied house raised to Rs 2 lakh from Rs 1.5 lakh.
● Set aside Rs 11,200 crore for PSU banks capitalisation
● Government in favour of consolidation of PSU banks
● Government considering giving greater autonomy to PSU banks while making them accountable
● PSUs to invest to over Rs 2.47 lakh crore this fiscal

Others
● Earmarks Rs 200 crore for Sardar Patel statue
● Proposes Rs 150 crore for improving women safety
● LCD, LED TV become cheaper
● Cigarettes, pan masala, tobacco, aerated drinks become costlier
● Government proposes to launch Digital India' programme to ensure broad band connectivity at village level
● Rs 100 crore scheme to support about 600 new and existing Community Radio Stations
● Rs 150 crore for Communication facilities in Andaman and Nicobar Islands
● Rs 188 crore for disaster preparedness in Puducherry
● Rs 3,600 crore for providing safe drinking water
● North-stop 24-hour channel is proposed to be introduced
● Farmer TV channel will be launched for the benefit of farmers.
● Rs 200 crore to make Delhi a world class city for social welfare and Rs 500 crore for energy
● Kisan Vikas Patra to be reintroduced, National Savings Certificate with insurance cover to be launched
● 'Pandit Madan Mohan Malviya New Teachers Training Programme' launched with initial sum of Rs 500 crore
● Government provides Rs 500 crore for rehabilitation of displaced Kashmiri migrants
● Indian Custom Single Window Project to be taken up for facilitating trade

Railway Budget 2014-15 Highlights

Union Railways Minister Sadananda Gowda presented the Rail Budget in the Parliament 8 July, 2014.


 Here are the highlights:

 ● Grateful to honourable PM Narendra Modi ji for having given me this opportunity and for entrusting me with this responsibility
 ● Honesty is the first chapter in the book of wisdom
 ● It gives me immense pleasure to present my first Railway Budget flooded with suggestion for new trains, new railway lines
 ● We now target to become the largest freight carrier in the world
 ● Indian railways carry only 31% of the total freight in the country. It is a challenge we have to face
 ● 5 lakh crore required each year for the next ten years for ongoing projects alone
 ● 23 paisa lost per passenger per km in 2012-13
 ● Social obligation of Railways in 2013-14 was Rs. 20,000 crore
 ● Focus on sanctioning projects rather than completing them
 ● The more projects we add the thinner we spread our resources
 ● I can get claps from this house by announcing many new projects but that would be rendering injustice to the struggling organization
 ● The fare revision was tough but a necessary decision - it will bring Indian Railways an additional revenue of 8,000 crores
 ● Indian Railways carries more than the entire population of Australia in a day
 ● Populist projects and mismanagement have brought Railways to point of funds crunch
 ● This state of affairs in railways needs immediate course correction
 ● Gross traffic receipts in 2013-14 was Rs. 1.3 lakh crore, operating ratio was 94 per cent
 ● Indian Railways spent Rs. 41,000 crore on laying of 3,700 km of new lines in last 10 years
 ● Need to explore alternative sources of resource mobilisation and not depend on fare hike alone
 ● Large part of the budget outlay to go to safety projects
 ● Maximum financial outlays for projects slated for completion in this area itself
 ● High priority areas - safety, cleanliness, passenger amenities and capacity augmentation
 ● Future projects to be financed on public-private partnership model
 ● Plans to attract investment from domestic and foreign players in infrastructure; focus to be on aggressive indigenisation
 ● FY15 Total Expenditure Pegged At Rs.1.49 lakh crore
 ● FY15 total receipts pegged at Rs.1.64 lakh crore
 ● Propose to hike budgetary plan outlay to Rs.47,650 crore
 ● FY15 passenger fare revenue pegged at Rs.44,600 crore
 ● Pre-cooked meals by reputed brands, focus on cleanliness and passenger feedback
 ● Outsource cleaning activities at 50 major stations, separate housekeeping wing for cleanliness and sanitation
 ● CCTVs to be used for monitoring cleanliness
 ● RO Drinking water at stations and trains
 ● Corporates encouraged to adopt stations for better maintenance and upkeep
 ● 17,000 Railway Protection Force personnel to be available soon
 ● Introduction of women RPF constables, coaches meant for women to be escorted for greater safety

 Bullet train:
 ● Indian Railways on course to fulfill its long cherished dream. I propose a Bullet train on the Ahmedabad - Mumbai sector
 ● Higher speed for existing trains will be achieved by upgrading the present network
 ● 23 projects underway in North-East. Propose to allocate higher funds than previous year for these projects


New Trains and Extended Trains in Rail Budget 2014 

58 new trains, including five new 'Jansadharan' trains and an equal number of premium group of trains have been proposed in the Rail Budget presented by railway minister Sadananda Gowda on 8 July, 2014.

The new trains include six AC Express trains, 27 Express trains, eight passenger trains, two Mainline Electric Multiple Unit (MEMU) services and 5 Diesel Electric Multiple Unit (DEMU) services besides extension of 11 existing trains.

Jansadharan Trains
(1) Ahmedabad-Darbhanga Jansadharan Express via Surat
(2) Jaynagar-Mumbai Jansadharan Express
(3) Mumbai-Gorakhpur Jansadharan Express
(4) Saharasa-Anand Vihar Jansadharan Express via Motihari
(5) Saharasa-Amritsar Jansadharan Express

Premium Trains
(1) Mumbai Central-New Delhi Premium AC Express
(2) Shalimar-Chennai Premium AC Express
(3) Secunderabad-- Hazrat Nizamuddin Premium AC Express
(4) Jaipur-Madurai Premium Express
(5) Kamakhya-Bengaluru Premium Express

AC Express Trains
(1) Vijayawada-NewDelhiAPExpress (Daily)
(2) LokmanyaTilak(T)-Lucknow (Weekly)
(3) Nagpur-Pune (Weekly)
(4) Nagpur-Amritsar (Weekly)
(5) Naharlagun-NewDelhi (Weekly)
(6) Nizamuddin-Pune (Weekly)

Express Trains
(1) Ahmedabad-Patna Express (Weekly) via Varanasi
(2) Ahmedabad- Chennai Express (Bi-weekly) via Vasai Road
(3) Bengaluru -Mangalore Express (Daily)
(4) Bengaluru -Shimoga Express (Bi-weekly)
(5) Bandra(T)-Jaipur Express (Weekly) Via Nagda, Kota
(6) Bidar-Mumbai Express (Weekly)
(7) Chhapra-Lucknow Express (Tri-weekly) via Ballia, Ghazipur, Varanasi
(8) Ferozpur-Chandigarh Express (6 days a week)
(9) Guwahati-Naharlagun Intercity Express (Daily)
(10) Guwahati-Murkongselek Intercity Express (Daily)
(11) Gorakhpur-Anand Vihar Express (Weekly)
(12) Hapa-Bilaspur Express (Weekly) via Nagpur
(13) Hazur Saheb Nanded-Bikaner Express (Weekly)
(14) Indore-Jammu Tawi Express (Weekly)
(15) Kamakhya-Katra Express (Weekly) via Darbhanga
(16) Kanpur-Jammu Tawi Express (Bi-weekly)
(17) Lokmanya Tilak(T)-Azamgarh Express (Weekly)
(18) Mumbai_Kazipeth Express (Weekly) via Balharshah
(19) Mumbai-Palitana Express (Weekly)
(20) New Delhi -Bhatinda Shatabdi Express (Bi-weekly)
(21) New Delhi-Varanasi Express (Daily)
(22) Paradeep-Howrah Express (Weekly)
(23) Paradeep-Visakhapatnam Express (Weekly)
(24) Rajkot-Rewa Express (Weekly)
(25) Ramnagar-Agra Express (Weekly)
(26) Tatanagar Baiyyappanahali (Bengaluru) Express (Weekly)
(27) Visakhapatnam-Chennai Express (Weekly)

Passenger Trains 
(1) Bikaner-Rewari Passenger (Daily)
(2) Dharwad-Dandeli Passenger (Daily) via Alnavar
(3) Gorakhpur-Nautanwa Passenger (Daily)
(4) Guwahati-Mendipathar Passenger (Daily)
(5) Hatia-Rourkela Passenger
(6) Byndoor-Kasaragod Passenger (Daily)
(7) Rangapara North-Rangiya Passenger (Daily)
(8) Yesvantpur-Tumkur Passenger(Daily)

MEMU services 
(1) Bengaluru-Ramanagaram 6 days a week (3Pairs)
(2) Palwal-Delhi-Aligarh

DEMU services 
(1) Bengaluru -Neelmangala (Daily)
(2) Chhapra-Manduadih (6days a week) via Ballia
(3) Baramula-Banihal (Daily)
(4) Sambalpur-Rourkela (6 days a week)
(5) Yesvantpur-Hosur (6 days a week)

Extension of Run of Existing Trains 
(1) 22409/22410 Anand Vihar Sasaram Garib Rath Express to Gaya
(2) 12455/12456 Delhi Sarai Rohilla Sriganganagar Express to Bikaner
(3) 15231/15232 Gondia Muzaffarpur Express to Barauni
(4) 12001/12002 New Delhi Bhopal Shatabdi Express to Habibganj
(5) 54602 Ludhiana-Hissar Passenger to Sadulpur
(6) 55007/55008 Sonpur-Kaptanganj Passenger to Gorakhpur
(7) 55072/55073 Gorakhpur-Thawe Passenger to Siwan
(8) 63237/63238 Buxar-Mughalsarai MEMU to Varanasi
(9) 63208/63211 Jhajha-Patna MEMU to Jasidih
(10) 64221/64222 Lucknow Hardoi MEMU to Shahjahanpur
(11) 68002/68007 Howrah-Belda MEMU to Jaleswar

Saturday, March 9, 2013

Highlights of Railway Budget 2013-14

The Railway Budget 2013-14 presented by the Railway Minister Shri Pawan Kumar Bansal in the Parliament lays thrust on safety, consolidation, improving passenger amenities and fiscal discipline.

The budget has absorbed the increase in passenger tariff due to increase in diesel prices but has proposed minor increase in supplementary charges for super fast trains and Tatkal charges etc. It has proposed FAC-linked revision in freight tariff only.

The Budget has proposed working expenses of Rs. 96,500 crore against the Gross Traffic Receipts of Rs. 1,43,742 crore for the year. The Railway Minister has proposed that appropriation to the Pension Fund of Railway Employees to Rs. 22,000 crore while appropriation to Depreciation Reserve Fund to Rs. 7,500 crore. With these proposals Railways expected to close the year 2013-14 with a balance of Rs. 12,506 crore in the Railway Fund.

The budget has proposed number of measures to improve passenger amenities including IT enable services for reservations and new trains.

The Minister informed that the Indian Railways is set to achieve the milestone of entering the select club of railways with over 1 million ton freight loading. At present, only the Chinese, Russian and the US Railways have this distinction. The Indian Railways have joined another select club of railways which run freight trains of more than 10,000 tones load.

Major highlights of the budget

a) New railway projects to be taken up during 2013-14: introduction of 67 new express trains, 26 new passengers services and extension of 57 trains besides increase in frequency of 24 trains. For the first time an AC EMU rake will be introduced on Mumbai suburban network and rake length will be increased from 9 cars to 12 cars in 80 services in Kolkata and 30 services in Chennai. The Minister proposed a target to complete 500 km of new lines and to convert 450 km lines to broad gauge during 2013-14.
b) Contribution for promotion of sports in the country: All the Rajiv Gandhi Khel Ratna and Dhyan Chand Awardees will be provided Complimentary Passes for traveling by 1st Class/2nd AC. Complimentary Passes will be provided to Olympic Medalists and Dronacharya Awardees for travel in Rajdhani/Shatabadi Express. Passes for freedom fighters will now be renewed once in three years instead of every year.
c) Staff Welfare measures: Enhanced fund allocation for staff quarters to Rs. 300 crore and setting up of hostels for single women railway employees at all divisional headquarters.
d) Proposed new lines from Rama Mandi to Maur Mandi via Talwandi Sabo and issuing ‘Yatra Parchis’ for Mata Vaishno Devi Shrine at the time of Railway ticket booking to facilitate pilgrims.
e) A multi-disciplinary training institute will set up at Nagpur for training in rail related electronics technologies.
f) For the first time the State of Arunachal Pradesh has been brought into the rail network and the railways will commission the Harmuti-Naharlagun line this year.
g) To strengthen the security of rail passengers, especially women passengers, Railways have already created four companies of women RPF personnel and another eight would be set up.
h) Identification of 104 stations, serving a population of more than one mission or those serving places of religious/tourist importance for immediate attention to all aspects related to cleanliness.
i) Progressive extension of bio-toilets on trains.
j) Provision of concrete aprons on platforms with mechanized cleaning facilities. 200 stations have already been covered.
k) Extension of On Board Housekeeping Scheme (OBHS) and Clean Trains Stations (VTSs) to more stations and trains.
l) Extension of unreserved Ticketing System (UTS), Automatic Ticket Vending Machines (ATVMs), Coin-operated Ticket Vending Machines (CO-TVMs) and scheme of Jan-Sadharan Ticket Booking Sevaks (JTBSs).
m) Setting up of six more Rail Neer bottling plants at Vijayawada, Nagpur, Lalitpur, Bilaspur, Jaipur and Ahmedabad.
n) Launching of a pilot project on select trains to facilitate passengers to contact on-board staff through SMS/phone call/e-mail for prompt response for coach cleanliness and also to provide real time feedback.
o) Setting up of 8-10 more mechanized laundries for quality washing of linen.
p) Provision of announcement facility and electronic display boards in trains for disseminating information to on-board passengers about approaching stations, train running, arrival platforms, etc.
q) Providing free Wi-Fi facility on several trains to cater to the increasing aspirations and requirement of youth and other valued customers.
r) Upgrading another 60 stations as Adarsh Stations in addition to 980 already selected.
s) Associate voluntary organizations for providing first aid services etc. at railway stations.
t) An educational tourist train called ‘Azadi Express’ to enable youth of the country to travel to important places connected with the freedom movement will be launched.
u) The Indian Railways will introduce one such coach in select trains which will provide an excellent ambience and latest modern facilities and services. Such coaches will be named ‘Anubhuti’ and will have commensurate fare structure.
v)  To facilitate the boarding of trains and exit from the stations for the differently-abled and the elderly, the Railways propose to take several measures. These include provision of 179 escalators and 400 lifts at A-1 and other major stations, affixing Braille stickers indicating the layout of coaches including toilets, provision of wheel chairs and battery operated vehicles at more stations and making coaches’ wheel-chair friendly.
w) State-of-the-art base kitchens are proposed to be set up in railway premises for better monitoring of quality of meals. ISO certification will now be insisted upon for all base-kitchens. A Centralized Catering Services Monitoring Cell with a toll free number – 1800 111 321 has started functioning from 18th January, 2013 to facilitate redressal of complaints/suggestions on realtime basis.
x) Ministry will put in place a Next Generation e-ticketing system to bring about a paradigm shift in internet rail ticketing. It will support 1, 20,000 simultaneous users at any point in time against the present capacity of 40,000 users with capability to easily scale up as demand increases in future. The system will make use of advanced fraud control and security management tools thereby further improving fairness and transparency in disbursal of tickets.

Friday, March 16, 2012

Union Budget 2012-13 Summary

The Union Budget 2012-13 presented by the Finance Minister ShriPranab Mukherjee in LokSabha identifies five objectives to be addressed effectively in the ensuing fiscal year.   They include focus on domestic demand driven growth recovery; create conditions for  rapid revival of high growth in private investment;  address  supply bottlenecks  in agriculture, energy and transport sectors  particularly in coal, power, national highways , railways and civil aviation; intervene decisively  to address the problem of malnutrition  especially in the 200 high-burden districts and  expedite coordinated implementation of decisions being taken to improve delivery systems , governance, and transparency;  and address the problem of black money and corruption in public life. 

ShriPranab Mukherjee said that India’s GDP growth in 2012-13 is expected to be 7.6 per cent +/-0.25 per cent.  He said that in 2011-12, India’s GDP is estimated to grow at 6.9 per cent after having grown at the rate of  8.4 per cent in each of the  two preceding years.  He said though the global crisis  had affected India, it still remains among  the front runners in economic growth.  Shri Mukherjee said the slowdown is primarily due to deceleration in industrial growth.  Stating that the headline inflation remained high for most part of the year, the Finance Minister expressed hope that it will moderate further in the next few months and remain stable thereafter.

            Shri Mukherjee laid emphasis on striking a balance between fiscal consolidation and strengthening macroeconomic fundamentals.  He announced introduction of amendments to the Fiscal Responsibility and Budget Management Act, 2003 (FRBM Act) as part of the Finance Bill 2012.  He said that concept of “Effective Revenue Deficit” and “Medium Term Expenditure Framework” statement are two important features of Amendment to FRBM Act in the direction of expenditure reforms.  This statement shall set forth a three year rolling targets for expenditure indicators.

            The Finance Minister called for a need to have a close look at the growth of revenue expenditure, particularly, on subsidies.  He announced that from 2012-13  while subsidies related to food and for administering the Food Security Act will be fully provided for,  all other subsidies would be funded to the extent that they can be borne by the economy without any adverse implications.  He said that the Government will endeavor to restrict the expenditure on central subsidies under 2 per cent of GDP in 2012-13and over the next three years, it would be further brought down to 1.75 per cent of GDP.Shri Mukherjee said that based on recommendations of the Task Force headed by ShriNandanNilekani, a mobile-based Fertilizer Management System has been designed to provide end-to-end information on movement of fertilizers and subsidies which will be rolled out nation-wide during 2012.  He said that transfer of subsidy to the retailer and eventually to the farmers will be implemented in subsequent phases which will benefit 12 crore farmer families. 

            On the tax reforms, the Finance Minister said that the  Direct Taxes Code (DTC) Bill will be enacted at the earliest after expeditious examination of the report of the Parliamentary  Standing Committee.  He said drafting of  model  legislation for Centre and State Goods and Services Tax (GST) in concert with States is under progress.  He added that the GST network will be set up as a  National Information Utility and will become operational by August 2012.

            On the disinvestment policy, Shri Mukherjee said that the Central Public Sector Enterprises (CPSEs) are being given a level playing field vis-à-vis private sector with regard to practices like buy-backs and  listing at stock exchange.  Stating that while in 2011-12, the Government will raise about Rs.14,000crore  from disinvestment as against a target of  Rs.40,000 crore,  the Finance Minister proposed to raise  Rs.30,000 crore through disinvestment in  2012-13.  He said at least 51 per cent ownership and management of CPSEs will remain with the Government.

            Calling for strengthening investment environment, Shri Mukherjee said that efforts are on to arrive at a broad-based consensus in respect of decision to allow FDI in multi-brand retail up to 51 per cent.  He proposed to introduce a new scheme  called Rajiv Gandhi Equity Savings Scheme  to allow for income tax deduction of 50 per cent to new retail investors who invest up to  Rs.50,000 directly in equities and whose annual income is below Rs.10 lakh.  The scheme will have a lock-in period of 3 years.  Regarding capital markets, the Finance Minister  proposed to allow Qualified Foreign  Investors (QFIs) to access Indian Corporate Bond market.  He also  proposed simplifying  the process of Initial Public Offer  (IPO).

            ShriPranab Mukherjee said that the Government is committed to protect the financial health of  Public Sector Banks and Financial Institutions.    He proposed to provide Rs. 15,888 crore for capitalization of Public Sector Banks, Regional Rural Banks and other financial institutions  including NABARD.  He added that a Central Know Your Customer (KYC) depositary will be developed in 2012-13 to avoid multiplicity  of registration and data upkeep.

            The Finance Minister informed that out of 73,000 identified habitations that were to be covered under “Swabhimaan” campaign for providing banking facilities by March 2012, about 70,000 habitations have been covered while the rest are likely to be covered by March 31, 2012.    He added that as a next step Ultra Small Branches are being set up at these habitations.  In 2012-13, Swabhimaan campaign will be extended to more habitations. 

            Emphasizing on infrastructure and industrial development, Shri Mukherjee said that during the 12th Plan, infrastructure investment will go up to Rs.50 lakh crorewith  half of this expected from private sector.  Stating  that in 2011-12 tax free bonds for Rs.30,000 crore were announced for financing infrastructure projects, he proposed to double it to raise Rs.60,000 crore in 2012-13.  The Minister proposed to allow External Commercial Borrowings (ECB) to part finance Rupee debt of existing power projects. 

            The Finance Minister ShriPranab Mukherjee announced a  target of covering  8,800 km. under NHDP next year and increase in allocation of the Road Transport and Highways Ministry  by   14 per cent to Rs.25,360 crore in 2012-13.  He proposed to permit ECB for working capital requirements of the Airline Industry for a period of one year, subject to a total ceiling  of US dollar  1 billion to address the immediate financial concerns of the Civil Aviation Sector.   He added that a proposal  to allow foreign airlines to participate up to  49 per cent in the equity  of an air transport undertaking is under active consideration.

            Expressing concern over shortage in housing sector, the Finance Minister proposed  various measures to address the shortage of housing for low income groups in major cities and towns including ECB for low cost housing projects and setting up of a Credit Guarantee Trust Fund. 

            Regarding textile sector, the Finance Minister announced setting up of two more mega clusters, one to cover Prakasam and Guntur districts in Andhra Pradesh and other for Godda and neighboring districts in Jharkhand in addition to 4 mega handloom clusters already operationalized.  He also proposed setting up of three Weavers Service Centres, one each in Mizoram, Nagaland and Jharkhand.  The Minister proposed  aRs. 500 crore pilot scheme in twelfth plan for promotion and application of Geo-textiles in the North East.   A powerloom Mega Cluster  will be set up in  Ichalkaranji in Maharashtra.

            The Finance Minister proposed to set up a Rs.5000 croreIndia  Opportunities Venture Fund with SIDBI to enhance availability of equity to Micro, Small and Medium Enterprises. 

            Stating that agriculture will continue to be a priority for GovernmentShri Mukherjee proposed  an increase  by 18 per cent to Rs. 20,208 crore in the total Plan Outlay for the Department of Agriculture and Cooperation in 2012-13.  He said that the outlay for RashtriyaKrishiVikasYojana (RKVY) is being increased to  Rs. 9217 crore in 2012-13. 

            Underlining importance of timely access to affordable credit for farmers, the Finance Minister proposed to raise the target for  agricultural credit to Rs.5,75,000 crore, which represents an increase of Rs. 1,00,000 crore over the target for the current year..   He said that a short term RRB Credit  Refinance Fund is being set up to enhance the capacity of Regional Rural Banks to disburse short term crop loans to the small and marginal farmers.  He added that Kisan Credit Card Scheme will be modified to make it a smart card which can be used at ATMs.

            The Financed Minister said that in order to have a better out reach of the food processing sector, a new centrally sponsored scheme titled National Mission on Food Processing will be started in cooperation with the States in 2012-13. 

            The Finance Minister proposed an increase of 18 per cent to  Rs.37,113crore for Scheduled Castes Sub Plan and  an increase of 17.6 per cent to Rs.21,710 crore for Tribal Sub Plan during 2012-13. 

            Regarding food security, Shri Mukherjee said that National Food Security Bill 2011 is before Parliamentary Standing Committee.   He said a multi-sectoralprogramme to address maternal and child malnutrition in selected 200 high burdened districts is being rolled out during 2012-13.  He further  said that an allocation of Rs.15,850 crore has been made for ICDS scheme which is an increase of 58% and Rs.11,937 crore for  National Programme of Mid-Day Meals in schools for the year 2012-13.  He added that an allocation of Rs.750 crore is proposed for Rajiv Gandhi Scheme for Empowerment of Adolescent Girls, SABLA. 

            The allocation for rural drinking water and sanitation is proposed to be increased by over 27 per cent to Rs. 14,000 crore and for PradhanMantri Road SadakYojana by 20 per cent to Rs. 24,000 crore in 2012-13.  He proposed to enhance the allocation under Rural Infrastructure Development Fund to  Rs. 20,000 crore with  Rs.5,000 crore exclusively earmarked for .creating warehousing facilities.

            The Finance Minister proposed an  increase in  allocation by 21.7 per cent  for Right to Education – SarvaShikshaAbhiyan to Rs.25,555 crore and by 29 per cent  for RashtriyaMadhyamikShikshaAbhiyan to Rs. 3,124 crore,   He proposed to set up a Credit Guarantee Fund to ensure better flow of funds to students.

            Regarding health sector  he proposed an increase in allocation for NRHM to Rs.20,822 crore in 2012-13.  He also said that National Urban Health Mission is being launched.

            The Finance Minister said that Mahatma Gandhi National Rural Employment Guarantee Scheme has had a positive impact.  He proposed an allocation of Rs.3915 crore for National Rural Livelihood Mission (NRLM) which represents an increase  of 34 per cent. He proposed to provide Rs.200 crore to enlarge the corpus to Rs.300 crore of the Women’s SHG’s Development Fund.  He said the fund will also support the objectives of  Aajeevika i.e.  NRLM and will empower  women  SHGs to access bank credit. He also proposed to establish a Bharat Livelihoods Foundation of India through Aajeevika which will support and scale up civil society initiatives and interventions particularly in the tribal regions covering around 170 districts.

            Allocation under National Social Assistance Programme (NSAP) is proposed to be raised by 37 per cent to Rs. 8447 crore.  Under the Indira Gandhi National Widow Pension Scheme and Indira Gandhi National Disability Pension Scheme for BPL beneficiaries, the monthly pension amount per person is being raised from Rs. 200 to Rs.300.

            The Finance Minister announced a provision of Rs.1,93,407crore for Defence Services including Rs.79,579 crore for capital expenditure.  He said the allocation is based on present needs and any further requirement would be met.
           
Addressing Governance related issues, Shri Mukherjee said adequate funds are proposed to be allocated to complete enrolments of another 40 crore persons under UID Mission. Outlining the steps taken by the Government to address the issue of black money, the Minister proposed to lay a White Paper  on Black Money in the  current session of Parliament.

In the Budget Estimates for 2012-13, the Gross Tax Receipts are estimated at Rs.10, 77,612 crore which is an increase of 15.6 per cent over the Budget Estimates and 19.5 per cent over the revised estimates for 2011-12.  After devolution to States, the net tax to the Centre in 2012-13 is estimated at Rs. 7,71,071crore.  The Non Tax Revenue Receipts are estimated at Rs.1,64,614crore and Non-debt Capital Receipts  at Rs.41,650 crore.  The total expenditure for 2012-13 is budgeted  at Rs.14,90,925 crore.  Of this Rs.5,21,025crore is the Plan Expenditure while Rs.9,69,900 crore is budgeted as Non Plan Expenditure.

            The tax proposals are guided by the need to move towards the Direct Tax Code(DTC) in the case of direct taxes and Goods & Services Tax (GST) in the case of indirect taxes.

            Individual income upto Rs.2 lakh will be  free from income tax; income upto Rs.1.8 lakh was exempt in 2011-12.  Income above  Rs.5 lakh and upto Rs.10 lakh now carries tax at the rate of 20 per cent; the 20% tax slab was from Rs.5 lakh to Rs.8 lakh in 2011-12.  A deduction of upto Rs.10,000 is now available for interest from savings bank accounts. Within the existing limit for deduction allowed for health insurance, a deduction of upto  Rs.5000 is being allowed for preventive health check-up.  Senior citizens not having income from business will now not need to pay advance tax.
            While no changes have been made in corporate taxes, the budget proposes a number of measures  to promote investment in specific sectors.  In order to provide low cost funds  to some stressed infrastructure sectors, withholding tax on interest payments on external borrowings (ECBs) is being reduced from 20 percent to 5 per cent for 3 years.  These sectors are - power, airlines, roads and bridges, ports and shipyards, affordable housing, fertilizer, and dam.
            Investment linked deduction of capital expenditure in some businesses is proposed to be provided at 150 per cent as against the current rate of 100 per cent.  These sectors include cold chain facility, warehouses  forstoring food-grains, hospitals, fertilizers and affordable housing.   Bee keeping, container  freight and warehousing  for storage of sugar will now also be eligible for investment linked deduction.  
The budget also proposes weighted deduction for R&D expenditure, agri-extension services and expenditure on skill development in the manufacturing sector.
            For small and medium enterprises (SMEs) the turnover limit for compulsory tax audit of accounts as well as for presumptive taxation is proposed to be raised from Rs. 60 lakh to Rs. 1 crore. In order to augment funds for SMEs,  sale of residential property will be exempt from capital  gains tax, if the proceeds are used for purchase of plant and machinery, etc. 
            A General Anti-Avoidance Rule (GAAR) is being introduced in order to counter aggressive tax avoidance. Securities transaction tax (STT) is being reduced by 20 per cent on cash delivery transactions, from 0.125% to 0.1%.  Alternative Minimum Tax is proposed to be levied from all persons, other than companies, claiming profit linked deductions.
            The Finance Minister has  proposed a series of measures to deter the generation and use of unaccounted money. In the case of assets held abroad, compulsory reporting is being introduced and assessment upto 16 years will now be allowed to be re-opened.  Tax will be collected at source on trading in coal, lignite and iron ore; purchase of bullion or jewellery above Rs. 2 lakh in cash; and transfer of immovable property (other than agricultural land) above a specified threshold.  Unexplained money, credits, investments, expenditures etc. will be taxed at the highest rate of 30 per cent irrespective of the slab of income.
            The Finance Minister has made an effort to widen the service tax base, strengthen its enforcement and bring it as close as possible to the central excise. A common simplified registration form and a common return are being introduced for central excise and service tax.
            All services will now attract service tax, except those in the negative list.  The negative list  has 17 heads and includes  specified services provided by the government or local authorities, and services in the fields of education, renting of residential dwellings, entertainment and amusement,   public transportation, agriculture and animal husbandry.  A number of other services including health care, and services provided by charities, independent journalist, sport persons, performing artists in folk and classical arts, etc are exempt from service tax.  Film industry also gets tax exemption on copyrights relating to recording of cinematographic films.
Service tax rate is being increased from 10 per cent to 12 per cent, with consequential change in rates for services that have individual tax rates. The standard rate of excise duty for non-petroleum goods is also being raised from 10 per cent to 12 per cent. No change is proposed in peak rate of customs duty of 10 per cent on non-agricultural goods.
The Budget offers relief to different sectors of economy, especially those under stress.  Import of equipment for fertilizer projects are being fully exempted from basic customs duty of 5 per cent for 3 years.  Basic customs duty is also being lowered for a number of equipment used in agriculture and related areas.  
In the realm of infrastructure, customs relief is being given to power, coal and railways sectors.  While steam coal gets full customs duty exemption for 2 years (with the concessional counter-veiling duty of 1 per cent), natural gas, LNG and certain uranium fuel get full duty exemption this year.  Different levels of duty concessions are being provided to help mining, railways, roads, civil aviation, manufacturing, health and nutrition and environment.  So as to help modernization of the textile industry, a number of equipment are being fully exempted from basic customs duty, and lower customs duty is being proposed for some other items used by the textile industry. 
Customs duty is being raised for gold bars and coins of certain categories, platinum and gold ore.  Customs duty  is to be imposed on coloured gem stones.  Excise duty on certain categories of cigarettes and bidis, pan masala and chewing tobacco is being increased.  Customs duty is being increased  on completely built large cars/ SUVs/ MUVs of value exceeding $40,000. 
Silver jewellery will now be fully exempt from excise duty. Unbranded  precious metal jewellery will attract excise duty on the lines of branded jewellery. Operations are being simplified and measures taken to minimize impact of this provision on small artisans and goldsmiths.
While direct tax proposals in the Budget will result in a net revenue loss of Rs.4,500crore, indirect taxes will result in a net revenue gain of Rs.45,940 crore.  Thus, the tax proposals will lead to a net gain of Rs.41,440crore

Union Budget 2012-13 Highlights

·         Budget identifies five objectives relating to  growth recovery, private investment, supply bottlenecks, malnutrition and governance matters
·         GDP growth to be 7.6 per cent (+ 0.25 percent) during 2012-13
·         Amendment to the FRBM Act proposed  as part of Finance Bill.  New concepts of “Effective Revenue Deficit” and “Medium Term Expenditure Framework” introduced
·         Central subsidies to be kept under 2 per cent of GDP; to be further brought down to 1.75 per cent of GDP over the next 3 years.
·         Proposed: Mobile based fertilizer management system; LPG transparency portal; scaling up and rolling out of Aadhar enabled payment for government schemes in at least 50 districts.
·         Rs. 30,000 crore to be raised through disinvestment
·         Efforts to reach broadbased consensus on FDI in multi-brand retail
·         Rajiv Gandhi Equity Saving Scheme: to allow income tax deduction to retail investors on  investing in equities
·         Rs. 15,888 crore to be provided for capitalization of public sector banks and financial  institutions
·         A central  “Know Your Customer” depository to be developed
·         Swabhimaan: remaining habitations to be covered; to be extended to more habitations; ultra small branches to be set up in Swabhimaan habitations
·         Investment in 12th Plan in infrastructure to go uptoRs. 50,00,000 crore; half of this is expected from private sector
·         Tax Free Bonds of Rs. 60,000 crore to be allowed for financial infrastructure projects
·         Allocation of Road Transport and Highways Ministry enhanced by 14 per cent to Rs. 25,360 crore
·         Financial package of Rs. 3,884 crore for waiver of loans to handloom weavers and their cooperative societies; mega handloom clusters in Andhra, Jharkhand; weaver service centres in Mizoram, Nagaland and Jharkhand ; powerloom mega cluster in Maharashtra; Rs. 500 crore pilot schemes for geo-textiles in North-Eastern region
·         Rs. 5,000 crore India Opportunities Venture Fund to help small enterprises
·         Allocation to agriculture enhanced; RKVY gets Rs. 9,217 crore; BGREI gets Rs. 1,000 crore; Rs.2242 crore project to improve dairy productivity; Rs. 500 crore for coastal aquaculture
·         Various other agricultural activities merged into 5 missions
·         Target for agricultural credit raised to Rs. 5,75,000 crore
·         Interest subvention for short-term crop loans to farmers at 7 per cent interest continues; additional 3 per cent for prompt paying farmers
·         Rs. 200 crore for awards to incentivise agricultural research
·         Provisions under rural housing fund increased to Rs. 4,000 crore from Rs. 3,000 crore
·         Interest subvention of 1 percent on housing loans uptoRs. 15 lakh extended for one more year
·         AIBP allocation raised by 13 per cent to Rs. 14,242 crore
·         National Mission on Food Processing to be started in cooperation with State Governments
·         Scheduled Caste Sub Plan allocation increases by 18 per cent to Rs. 37,113 crore; Tribal Sub Plan by 17.6 per cent to Rs. 21,710 crore
·         Multi-sectoralprogramme to address maternal and child malnutrition in 200 high burden districts
·         58 per cent rise in allocation to ICDS, at Rs. 15,850 crore
·         Rural drinking water and sanitation gets 27 per cent rise in allocation to Rs. 14,000 crore; PMGSY gets 20 per cent rise to Rs. 24,000 crore
·         Projects covering length of 8800 km to be awarded under NHDP against 7,300 km during 2011-12
·         RTE-SSA gets Rs. 25,555 crore allocation, showing an increase of 21 per cent; 6000 schools to be set up at block level as model schools in the 12th Plan; Credit Guarantee Fund to be set up for better flow of credit to students
·         National Urban Health Mission is being launched
·         34 per cent increase in allocation to National Rural Livelihood Mission, to Rs. 3915 crore
·         Rs. 1000 crore allocated for National Skill Development Fund
·         Bharat Livelihood Foundation to be established to support livelihood interventions particularly in  tribal areas
·         Widow pension and disability pension raised from Rs. 200 to Rs. 300 per month
·         Grant on death of primary breadwinner of a BPL family in the age group 18-64 years doubled to Rs. 20,000
·         Defence services get Rs. 193407 crore; any further requirement to be met
·         4000 residential quarters to be constructed for Central Armed Police Forces
·         UID-Aadhar to get adequate funds for enrolment of 40 crore persons, in addition to the 20 crore persons already enrolled
·         White Paper on Black Money to be laid in the current session of Parliament
·         Tax proposals mark progress in the direction of movement towards DTC and GST
·         Income tax exemption limit raised from Rs.1,80,000 to Rs.2,00,000; upper limit of 20 per cent tax slab raised from Rs.8 lakh to Rs.10 lakh
·         Interest from savings bank accounts deductible upto Rs.10,000; deduction of upto Rs.5,000 for preventive health check-up
·         Senior citizens without business income exempt from advance tax
·         Investment linked deduction of capital expenditure enhanced for certain businesses; new sectors eligible for investment linked deduction
·         Turnover limit for compulsory tax audit for SMEs raised from Rs.60 lakh to Rs.1 crore
·         STT on cash delivery reduced by 20 per cent to 0.1%
·         General Anti Avoidance Rule being introduced to counter aggressive tax avoidance
·         A number of measures proposed to deter generation and use of unaccounted money
·         All services to attract service tax except those in the negative list
·         Central Excise and Service Tax being harmonized
·         Standard rate of excise duty raised from 10 per cent to 12 per cent; service tax rates raised from 10 per cent to 12 per cent; no change in peak customs duty of 10 per cent on non-agricultural goods
·         Relief in indirect taxes to sectors under stress; agriculture, infrastructure, mining, railways, roads, civil aviation, manufacturing, health and nutrition, and environment get duty relief
·         Certain cigarettes and bidis attract higher excise duty; large cars attract higher customs duty
·         Excise imposed on unbranded jewellery also; measures to minimize impact on small artisans  and goldsmiths; branded silver jewellery exempted from excise duty
·         Net gain of Rs.41,440 crore due to taxation proposals
·         Total expenditure budgeted at Rs. 14,90,925 crore; plan expenditure at Rs. 5,21,025 crore – 18 per cent higher than 2011-12 budget; non plan expenditure at Rs. 9,69,900 crore
·         Fiscal deficit targeted at 5.1 per cent of GDP, as against 5.9 per cent in revised estimates for 2011-12
·         Central Government debt at 45.5 per cent of GDP as compared to Thirteenth Finance Commission target of 50.5 per cent
·         Medium-term Expenditure Framework Statement to be  introduced; will set forth 3-year rolling target for expenditure indicators