New Delhi: The Government on Monday outlined measures to speed infrastructure development and unveiled increased spending for farmers and the poor in its first Budget since Prime Minister Manmohan Singh's government was re-elected by a resounding margin in May.
Finance Minister Pranab Mukherjee, sticking to the theme of "inclusive growth" espoused by the Congress party-led United Progressive Alliance (UPA) Government, unveiled breaks for exporters hard-hit by the global downturn and direct subsidies for farmers.
He also urged a return to fiscal responsibility targets as soon as possible.
"The first challenge is to return the GDP growth rate of 9 per cent per annum at the earliest," Mukherjee said. "The second challenge is to deepen and broaden the agenda for inclusive development."
Reuters reports Mukherjee called on states to remove bottlenecks for infrastructure projects, and outlined plans for more flexible financing for infrastructure and development of long-distance gas pipelines.
Income Tax limits
Mukherjee proposed to increase the income tax exemption limit for senior citizens by Rs.15,000, for women and others by Rs 10,000 each, while keeping the corporate tax rate unchanged.
The exemption limit will now be Rs 240,000 for senior citizens, Rs.190,000 for women and Rs 160,000 for others.
Disinvestment targets
Mukherjee revived the government's divestment programme, promising equity of state-run enterprises in the hands of general public.
He also said that in areas like banking and insurance, specifically, the majority control in state-run companies would remain in the hands of the government with fresh infusion of equity to help them remain globally competitive.
Simple tax returns
The Government will work towards simplifying the tax structure in the next four years, said Mukherjee. The income tax department has also been asked to introduce the simplified version of the tax filing form Saral, called Saral 2.
Economic achievements
Mukherjee began his speech by highlighting the economy’s 6.7 per cent growth in 2008-9, reduction of inflation rate from 13 per cent to near zero per cent in a short period of time, improvement in industrial growth and stepping up of foreign investment.
Unconstrained by its previous alliance with leftist parties, the UPA Government has a freer hand to implement economic liberalisation measures to drive expansion but has also promised "inclusive growth" to support social programmes and rural development.
India's economy, Asia's third-largest, grew at 6.7 per cent in the most recent fiscal year, held back by the global downturn, after expanding at least 9 per cent for three straight years.
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Budget speech highlights:
Earlier, Mukherjee reached Parliament at about 0930 hrs IST with a maroon coloured briefcase containing Budget papers and the Union Cabinet met immediately to approve it.
The Cabinet gave the go ahead to the Budget after meeting for about 25 minutes.
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