Union Budget 2012-13: Sector Based Allocation

Union Finance Minister Pranab Mukharjee presented the annual budget for the fiscal year 2012-13 in the parliament on 16 March 2012.
The Union Minister of Finance came up with an increased budgetary allocation for various sectors including agriculture, rural development, defence etc. While, the Plan Outlay for Department of Agriculture and Co-operation increased by 18 percent, the target for agricultural credit raised by 100000 crore rupees to 575000 crore rupees. Budgetary allocation for rural drinking water and sanitation received a hike of over 27 per cent. Flagship programmes like Right to Education-Sarva Shiksha Abhiyan received an increase of 21.7 per cent in the budgetary allocation.

Some of the major allocations made for different sectors of economy are as follows:

Agriculture and Allied Activities

• Budgetary allocation for agriculture and allied activities 2012-13 increased by 18%
• 9217 crore rupees allocated for Rashtriya Krishi Vikas Yojana.
• 1000 crore rupees for Bringing Green Revolution to Eastern India (BGREI) project
• 300 crore rupees to Vidarbha Intensified Irrigation Development Programme under RKVY.
• 200 crore rupees allocated for incentivising research with rewards
• 14242 crore rupees allocated for Accelerated Irrigation Benefit Programme (AIBP)
• 500 crore rupees provided to broaden scope of production of fish to coastal aquaculture

Rural Development

• 14,000 crore rupees allocated for rural drinking water and sanitation
• 24000 crore rupees allocated for Pradhan Mantri Grameen Sadak Yojna
• 12040 crore rupees provided for Backward Regions Grant Fund scheme
• 20,000 crore rupees allocated for Rural Infrastructure Development Fund
• 5000 crore  rupees earmarked for creating warehousing facilities

Education
• Sarva Siksha Abhiyan-Right to Education- 25555 crore rupees
• 3124 crore rupees provided for Rashtriya Madhyamik Shiksha Abhiyan (RMSA)

Health

• 20822 crore rupees National Rural Health Mission

Employment and skill development
• 3915 crore rupees provided for National Rural Livelihood Mission
• 1276 crore rupees allocated for Prime Minister’s Employment Generation Programme
• 1000 crore rupees allocated for National Skill Development Fund

Defence and Security
• 193407 crore rupees aallocated for Defence services including 79579crore rupees for capital expenditure
• 1185 crore rupees to be allocated for construction of nearly 4000 residential quarters for Central Armed Police Forces
• 3280 crore rupees proposed to be allocated for construction of office building of CentralArmed Police Forces

Infrastructure and Industrial Development

• 25360 crore rupees allocated for Road Transport and Highways Ministry
• 3884 crore rupees loan waiver for handloom weavers and their cooperative societies
• 500 crore rupees pilot scheme announced for promotion and application of Geo-textile in the North Eastern Region
• 70 crore rupees allocated to set up a powerloom mega cluster in Ichalkaranji in Maharashtra
• 5000 crore rupees India Opportunities Venture Fund to be set up with SIDBI
• 15888 crore rupees to be provided for capitalisation of public sector banks and financial institutions

Other major allocations

• 37113 crore rupees allocated for Scheduled Castes Sub Plan
• 21710 crore rupees earmarked for Tribal Sub Plan

Union Budget 2012-13: Highlights

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

Budget Estimates 2012-13

Union Finance Minister Pranab Mukharjee presented the union budget 2012-13 in the parliament on 16 March 2012. The minister in his budget speech, projected the economic growth for 2012-13 to be 7.6%.

While the total tax receipts for fiscal year 2012-13 is estimated to be 1077612 crore rupees, the total budgetary expenditure is projected to be 1490925 crore rupees. Budgetary allocations for various sectors including education, health, agriculture, defence also received a reasonable hike.

     The highlights of Budget Estimates 2012-13 are presented below:

•    Gross Tax Receipts estimated at 1077612 crore rupees.
•    Net Tax to Centre estimated at 771071 crore rupees.
•    Non-tax Revenue Receipts estimated at 164614 crore rupees.
•    Non-debt Capital Receipts estimated at 41650 crore rupees.
•    Temporary arrangement to use disinvestment proceeds for capital expenditure in social sector schemes extended for one more year.
•    Total expenditure for 2012-13 budgeted at 1490925 crore rupees.
•    Plan expenditure for 2012-13 at 521025 crore rupees is 18 per cent higher than Budget Estimate of 2011-12. 99 per cent of the total plan outlay met in the Eleventh Plan.
•    Non-plan expenditure estimated at 969900 crore rupees.
•    365216 crore rupees estimated to be transferred to States.
•    Fiscal deficit at 5.1 per cent of GDP in Budget Estimate 2012-13.
•    Net market borrowing required to finance the deficit to be 4.79 lakh crore rupees in 2012-13.
•    Central Government debt at 45.5 per cent of GDP in 2012-13 as compared to Thirteenth Finance Commission target of 50.5 per cent.
•    Effective Revenue Deficit to be 1.8 per cent of GDP in 2012-13.