Union Finance Minister Pranab Mukherjee on 16 March 2012, tabled the union budget in the parliament for the financial year 2012-13. Mukharjee, who presented the fourth annual budget after he took over as the finance minister in 2008, seemed to focus on the recovery of the domestic economy.
The budget 2012-13 aims at achieving the rapid growth for the economy which remained on a downward spiral all through the fiscal year 2011-12. Finance Minister in the budget paid due attention on developing the conditions for economic growth. The budget estimated the Indian economy to grow at 7.6% in the fiscal year 2012-13.
Given below are the highlights of the budget 2012-13:
• Total expenditure in 2012-13 seen at 14.9 trillion rupees, up 29 percent
• Plan expenditure budgeted at 521.25 billion rupees in 2012-13, up 18 percent
• Economy expected to grow at 7.6 percent in 2012-13, plus or minus 0.25 percent
• Income-tax exemption limit raised to 2 lakh rupees from 180000 rupees
• Fiscal deficit seen at 5.1 percent of GDP in 2012-13
• Plan expenditure budgeted at 521.25 billion rupees in 2012-13, up 18 percent
• Net market borrowing seen at 4.8 trillion rupees in 2012-13
• Proposes to raise service tax rate to 12 percent from 10 percent
• Gross tax receipts seen at 10.8 trillion rupees in 2012-13
• Non-tax revenue seen at 1.64 trillion rupees in 2012-13
• Proposes to levy tax on all services except 17 items in the negative list from 2012-13
• No change in corporate tax rates
• Allow external commercial borrowing of up to 1 billion dollar to raise working capital for airlines industry for 1 year
• To allow qualified foreign investors in Indian corporate debt markets
• To allow external commercial borrowing to part finance rupee debt in power projects
• Allocates 1.94 trillion rupees for defence in 2012-13, up from 1.64 trillion rupees in previous year
• To award contracts to build 8800 km of roads in 2012-13
• 15888 crore rupees to be provided for capitalization of public sector banks and financial institutions
• Investment in 12th Plan in infrastructure to go upto 5000000 crore rupees; half of this is expected from private sector
• Allocation of Road Transport and Highways Ministry enhanced by 14 per cent to 25360 crore rupees
• 5000 crore rupees India Opportunities Venture Fund to help small enterprises
• Allocation to agriculture enhanced; RKVY gets 9217 crore rupees; BGREI gets 1000 crore rupees;.2242 crore rupees project to improve dairy productivity; 500 crore rupees for coastal aquaculture
• Target for agricultural credit raised to 575000 crore rupees
• 200 crore rupees for awards to incentivise agricultural research
• National Mission on Food Processing to be started in cooperation with State Governments
• Rural drinking water and sanitation gets 27 per cent rise in allocation to 14000 crore rupees; PMGSY gets 20 per cent rise to 24000 crore rupees
• Right To Education-Sarva Shiksha Abhiyan gets 25555 crore rupees 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 3915 crore rupees
• 1000 crore rupees allocated for National Skill Development Fund
• 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 20000 rupees
• 4000 residential quarters to be constructed for Central Armed Police Forces
• Government doubles allocation for tax-free bonds to 600 billion rupees for financing infrastructure projects in 2012-13
• Disinvestment target in 2012-13 of 300 billion rupees
• Expects country to become self-sufficient in urea production in five years
• Proposes to raise agricultural credit target in 2012-13 to 5.75 trillion rupees
• To keep 2012-13 subsidies under 2 percent of GDP
• Current account deficit seen at 3.6 percent of GDP in 2011-12
