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Budget 2007: tariffs cut, increased spending
By Sriparna
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Wednesday, 28 February 2007, 18:30 IST
New Delhi: Finance Minister P. Chidambaram presented the budget for 2007-08 to parliament. Experts feel that the budget is in continuation with the one already there and does not show much changes, reported a national daily.
As a distinct lack of enthusiasm prevailed in the Lok Sabha (lower house of the Parliament) with some MPs describing the budget as 'not so exciting.'
Highlights of the budget are as follows:
1. The average inflation rate seen at between 5.2 and 5.4 percent in 2006/07 and the finance minister expressed his confidence in tackling the present inflationary trend.
2. Revenue deficit remained at 2 percent and fiscal deficit at 2 percent of GDP. Increase in gross tax revenue by 19.9 percent. "Revenues were buoyant for the third year in succession. I have put the revenues to good use to promote inclusive growth, equity and social justice," Chidambaram said.
3. The Finance Minister said that all indicators point to an accelerating rate of investment. From April 2006-January 2007, foreign direct investment were at $12.5 billion. Overseas investment exceeds portfolio investments.
The Allocations:
1. Total plan spending set at Rs 2.05 trillion.
2. Spending on education raised by 34.2 percent to 323.5 billion rupees.
3. Spending on healthcare and family welfare raised by 21.9 percent to 152.9 billion rupees.
4. Spending on rural job guarantee scheme set at 120 billion rupees; plan expanded to 330 districts.
5. Spending on irrigation to be increased to 110 billion rupees.
6. National Bank for Agriculture and Rural Development to issue farm bonds worth 50 billion rupees.
7. Equity support to state-run firms set at 164 billion rupees.
8.Debt support to state-run firms set at 29.7 billion rupees for.
9. Spending on national highway programme increased to 106.67 billion rupees for next fiscal year from 99.45 billion in previous year.
10. Defence budget allocation increased to Rs 96,000 crore.
11. Technology upgradation fund to be continued in the 11th Plan. Allocation for handloom sector increased to Rs 911 crore. Allocation to textile parks hiked to Rs 412 crore.
The budget did not fetch much applause in the house of parliament. The Congress party's gloominess, following its debacle in the two state elections reflected as the finance minister read this two-hour-long budget speech.
The Bharatiya Janata Party (BJP)-led opposition, which created pandemonium inside the house during the last two days including while the railway budget was being presented on Monday, kept largely quiet, barring some remarks.