Highlights of Union Budget 2010 by Pranab Mukherjee

Riding on economic revival, Finance Minister Pranab Mukherjee on Friday announced major personal income tax sops but hiked excise duty from eight per cent to 10 per cent across the board on non oil products as also duties on petrol and diesel in the Union Budget for 2010-11.

Budget highlights:

• Impressive recovery in the past few months. Can witness faster recovery in the coming months, says Mukherjee.
• Focus shifted to non-governmental actors and an enabling government. Government will concentrate on supporting and delivering services to the economically backward sections.
• Fiscal year 2009-10 was challenging for Indian economy
• Economy stablished in Q1 of 2009 itself
• Manufacturing growth at 18.5 per cent in December was highest in two decade
• Export in January encouraging
• Figures for merchandise exports for January encouraging after turnaround in November and December last.
• Double digit food inflation last year due to bad monsoon and drought-like conditions
• Erratic monsoon and drought-like conditions forced supply side bottleneck that fuelled inflation
• Government conscious of the situation of price rise and taking steps to tackle it
• Need to review stimulus imparted to econony
• Need to ensure that the demand-supply imbalance is managed
• Stress on the need to make growth more broad-based
• Need to review the public spending and mobilise resources
• Status paper on public debt within six months
• Finance Minister says Government hopes to implement direct tax code from April 2011.
• Earnest endeavour to implement General Sales Tax in April 2011.
• Government will raise Rs 25,000 crore from disinvestment of its stake in state-owned firms
• Kirit Parekh report on fuel price deregulation will be taken up by Oil Minister Murli Deora in due course
• Nutrient based fertiliser subsidy scheme to come into force from April 1, 2010
• Market capitalisation of five PSUs listed since October increased by 3.5 times
• FDI inflows steady during the year. Government has taken series of steps to simplify FDI regime
• Government has decided to set up apex-level Financial Stability and Development Council
• RBI considering some additional banking licenses to private companies, NBFC will also be considered if they meet criteria
• Government intends to make FDI policy user friendly by compling all guidelines into one document
• Government to continue interest subvention of 2 per cent for one more year for exports covering handicrafts, carpets, handlooms and small and medium enterprises
• Government to provide Rs 300 crore to organise 60,000 pulse and oilseed villages and provide integrated intervention of watershed and related programme
• Government to provide Rs 16,500 crore to public sector banks to maintain tier-I capital
• Rs 200 crore provided for climate resilient agriculture initiative
• Government committed to ensure continued growth of Special Economic Zones.
• Need to take firm view on opening up of the retail sector
• Repayment of loan by farmers extended by six months to June 30, 2010 in view of drought and floods in some part of the country
• Interest subvention for timely repayment of crop loans raised from one per cent to two per cent, bringing the effective rate of interest to five per cent.
• Propose to maintain thrust of upgrading infrastructure in rural and urban areas. IIFCL authorised to refinance infrastructure projects.
• Rs 1,73,552 crore provided for infrastructure development
• Allocation for Railways fixed at Rs 16,752 crore, an increase of Rs 950 crore over last financial year
• Government proposes to set Coal Development Regulatory Authority
• Mega power plant policy modified to lower cost of generation; allocation to power sector more than doubled to Rs 5,130 crore in 2010-11
• Government for competitive bidding for coal blocks for captive power plants
• Rs 500 crore allocated for solar and hydro projects for Ladakh region
• Clean Energy Fund to be created for research in new energy sources
• Allocation for new and renewable energy ministry increased by 61 per cent to Rs 1,000 crore
• One-time grant of Rs 200 crore provided to Tirupur textile cluster in Tamil Nadu
• Allocation for National Ganga River Basin Authority doubled to Rs 500 crore
• Alternative port to be developed at Sagar Island in West Bengal
• Draft of Food Security Bill ready, to be placed in public domain soon
• Deficit in foodgrains storage capacity to be met by private sector participation
• Outlay for social sectors pegged at Rs 1,37,674 crore, accounting for 37 per cent of the total plan allocation
• Plan allocation for school education raised from Rs 26,800 crore to Rs 31,036 crore in 2010-11
• Plan allocation for health and family welfare increased to Rs 22,300 crore from Rs 19,534 crore
• For rural development, Rs 66,100 crore have been allocated
• Allocation for NREGA stepped up to Rs 40,100 crore in 2010-11
• Indira Awas Yojana scheme's unit cost raised to Rs 45,000 in plain area and Rs 48,500 in hilly areas
• Allocation for urban development increased by 75 per cent to Rs 5,400 crore in 2010-11
• Road transport allocation raised by 13 per cent to Rs 19,894 crore
• 25 per cent of plan outlay earmarked for rural infrastructure development
• One per cent interest subvention loan for houses costing up to Rs 20 lakh extended to March 31, 2011; Rs 700 crore provided
• Allocation for development of micro and small scale sector raised from Rs 1,794 crore to Rs 2,400 crore
• Rs 1,270 crore provided for slum development programme, marking an increase of 700 per cent
• Government decides to set up National Social Security Fund with initial allocation of Rs 1000 crore to provide social security to workers in unorganised sector.
• Road transport allocation raised by 13 per cent to Rs 19,894 crore
• Exclusive skill development programme to be launched for textile and garment sector employees.
• Allocation for women and child development hiked by 80 per cent.
• Rs 1,900 crore allocated for Unique Identification Authority of India.
• Government to contribute Rs 1,000 per year to each account holder under the new pension scheme.
• Plan outlay for Ministry of Social Justice raised by 80 per cent to Rs 4,500 crore.
• Plan allocation for Ministry of Minority Affairs raised from Rs 1,740 crore to Rs 2,600 crore.
• Financial Sector Legislative Reforms Committee to be set up.
• Unique identity symbol to be provided to the Indian Rupee in line with US Dollar, British Pound Sterling, Euro and Japanese Yen.
• Defence allocation pegged at Rs 1,47,344 crore in 2010-11 against Rs 1,41,703 crore in the previous year. Of this, capital expenditure would account for Rs 60,000 crore.
• Planning Commission to prepare integrated action plan for Naxal-affected areas.
• FM appeals to "misguided elements" (left wing extremists) to eschew violence and join the mainstream.
• Gross tax receipts pegged at Rs 7,46,656 crore for 2010-11, non-tax revenues at Rs 1,48,118 crore.
• Total expenditure pegged at Rs 11.8 lakh crore, an increase of 8.6 per cent.
• Fiscal deficit at 5.5 per cent, says FM
• Fiscal deficit seen at 4.8 per cent and 4.1 per cent in 2011-12 and 2012-13 respectively
• Non-plan expenditure pegged at Rs 37,392 crore and Plan expenditure at Rs 7,35,657 crore in budget estimates. 15 per cent increase in plan expenditure and six per cent in non-plan expenditure.