Indian Budget: Highlights, Reactions, and where your money is going

Last updated on: February 28, 2013 at 11:44 pm by Desh Kapoor

Indian Budget: Highlights, Reactions, and where your money is going 2013-02-28T23:44:04-06:00 Desh Kapoor

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Yet another budget has come out. This time by P. Chidambaram. I still remember people rushing home and sitting very meaningfully in front of the TV to see the budget being presented. The Accounting, Economics and Finance professionals trying to analyze and debate the budgets. I am not sure how it happens now, but there was a time when Indian Budget presentation was almost like a “Super Bowl” even in many homes. Professional friends would come over and there would intellectual debates and discussions over tea and snacks etc.

Within a few months, the futility of all the discussions would be very apparent. Because, except for the tax repurcussions, actually nothing else really impacts. Most of the other stuff is just a big drama to siphon money by the politicians and their sideys. Look at this year’s budget. Some figures – as to how much is being invested in different areas:

So, in a country where Farmers are dying due to high debt, we have investments of $129 billion in Agricultural Credit Schemes. Really??!! Then why the heck are the farmers dying? If such money was being really used to alleviate the credit situation of the farmers, India would have been the country of highest productivity.

Similar is the story of other ministries and efforts. Is this $200 bn being really invested in the schemes and ministries’ work as is being made out in the budget? One doubts that. In fact, instead of representing Government investment in a certain field, the budget breakup represents to the parasites of Indian economy where to focus on for the loot that year. For example, this year the flavor are the Tribals. They will be getting roughly $10 billion in two different ways. You go and visit the tribals today and after a year. You will know exactly where this money did NOT go!

The less said about MNREGA, the better.

Here are some reactions – rhetorical, plain wisdom, or ignorant banter. You decide. Also check out the main highlights of the budget in the end.

http://storify.com/drishtikone/india-budget-reactions

Budget Highlights (link)

Custom duty on imported motor vehicles hiked; import duty on luxury cars increased to 100% from 75%
Cigarettes and SUVs to be costlier; excise duty on SUV’s increased from 27% to 30%
No change in peak rate of customs duty for non-agriculture products
No change in basic customs duty rate of 10% and service tax rate of 12 %
20% final withholding tax on unlisted companies’ share buyback
1 per cent TDS on sale of immovable property, which is not applicable to agricultural land
In 2011-12, tax-GDP ratio was 5.5 per cent for direct taxes and 4.6 per cent for indirect taxes
Lower securities transaction tax on mutual fund payouts
Surcharge on corporate taxes increased; 5 to 10 per cent surcharge on domestic companies whose taxable income exceeds Rs 10 crore
10 per cent surcharge on those earning above Rs 1 crore
Tax credit of Rs 2000 to be provided to every person to having income of up to Rs 5 lakh, this will benefit 1.8 crore people
No changes in Income Tax rates or slabs, Rs 2000 credit for those earning up to Rs 5 lakh per annum
Gold duty free limit raised to Rs 50,000 for men and to Rs 1 lakh for women travellers
All AC restaurants will have to pay service tax whether or not they serve alcohol
Import duty raised on set-top boxes from 5 to 10% to safeguard interest of domestic producers
Tax holiday for power plants extended to March 2014
Investor with stake of 10 per cent or less will be treated as FII; any stake more than 10 per cent will be treated as FDI
‘Nirbhaya Fund’ of Rs 1,000 crore to empower women and provide safety in the wake of the Delhi gangrape incident
Non plan expenditure pegged at Rs 11,09,975 crore for 2013-14
FY14 fiscal deficit seen at 4.8% vs 5.2% in FY13
Revenue deficit at 3.9% for FY13
Fiscal deficit for FY 13 at 5.2%
PSU banks to have ATMs at all their branches by March 31, 2014
Rs 5,80,000 crore to states and Union Territories
289 FM radio channels to be auctioned in FY14
Rs 5,400 crore to department of space and Rs 5,600 crore to department of atomic energy
National Institute of Sports Coaching to be set up in Patiala at a cost of Rs 253 crore
FII participation in forex segment subject to FX exposure
Concessional 6% interest on loans to weavers
Rs 500 crore would be allocated for addressing environmental issues faced by textile industry
Defence allocated Rs 2.36 lakh crore with Rs 86,721 crore for capital expenditure
SIDBI’s re-financing facility to MSMEs to be doubled to Rs 10,000 crore
FII will be allowed to participate in currency derivatives segment: FM
FM asks state govts to prepare financial restructuring plan for power distribution companies at the earliest
All towns of India with a population of over 10,000 to have an LIC office
Insurance companies will be empowered to open branches in tier II cities without prior IRDA approval
KYC of banks will be sufficient to acquire insurance policies
Sincerely hope the PFRDA & Insurance bill can be passed
Proposal to amend SEBI Act under consideration
SEBI to simply procedures for FIIs, unify categories of FIIs
FM proposes to start a fund for urban housing
Rs 6,000 crore to be allocated for rural housing fund in 2013-14; Rs 2,000 crore for urban housing
Govt to set up India’s first women’s bank as a public sector bank by October; initial capital will be of Rs 1000 crore
Oil and gas exploration policy will be reviewed and moved from profit sharing to revenue sharing
Rs 14,000 cr for Public Sector Bank recap
Rs 14,000 crore capital infusion into public sector banks in 2013-14
Rajiv Gandhi Equity Scheme will be liberalised to allow first time investor to invest in Mutual Fund and equity
Many manufacturing projects stalled due to regulatory process: FM
Domestic workers, Anganwadi workers to get group insurance
Rashtriya Swasthya Bima Yojana to include rickshaw pullers, taxi drivers and ragpickers
DIPP and Japan’s JICA preparing plan for Chennai-Bengaluru Industrial corridor
Govt to construct power transmission system from Srinagar to Leh at the cost of Rs 1,840 crore, Rs 226 crore provided in current Budget
Two new ports in West Bengal and Andhra Pradesh
Tax free bonds issue to be allowed up to Rs 50,000 crore in 2013-14 strictly on capacity to raise funds from the market
A PPP project with Coal India in the pipeline to stem the outflow of forex
Coal imports to rise to 185 million tonnes from 100 million in four years
Government has decided to constitute a regulatory authority for the road sector: FM
A company investing Rs 100 crore or more in plant and machinery in April 1, 2013 to March 31, 2015 will be allowed 15% investment deduction allowance apart from depreciation
3,000 km of road projects will be awarded in first 6 months of FY14
Zero custom duty for electrical machinery
Inflation indexed bonds and NSCs to be introduced
Income level for Rajiv Gandhi Equity Scheme raised by Rs 2 lakh
First housing loan up to Rs 25 lakh would get additional deduction of interest of up to Rs 1 lakh in 2013-14
Indian Institute of Agri-Biotechnology to be established at Ranchi, Jharkhand
5 million tons Dabhol LNG import terminal to be operate at full capacity in 2013-14
CCI to take up more projects shortly
Rs 25,000 crore to be raised from four infrastructure bonds
Foodgrain production in 2012-13 will be over 250 million tons
Rs 80,194 crore allocated for rural development schemes
States which have completed Pradhan Mantri Gramin Sadak Yojana will be eligible for PMGSY-II, others will continue with PMGSY-I
Rs 5,000 crore will be made available to NABARD to finance construction of godowns and warehouses
Rs 17,700 crore provided for Integrated Child Development Scheme
Rs 5,284 crore to various Ministries for scholarships for SC/ST, OBC and minority students
Rs 7 lakh crore target fixed for agri credit for 2013-14 compared to Rs 5.75 lakh crore in the current year
Rs 27,049 crore allocation to the Agriculture Ministry in 2013-14
Rs 10,000 crore set aside for incremental cost for National Food Security Bill over and above food subsidy
National Livestock Mission launched with Rs 307 crore
Rs 15,260 crore to be allocated to Ministry of Drinking Water and Sanitation
Rs 1000 crore allotted to support increased rice production in Eastern Indian states
Rs 1069 crore allocated to Department of Aryush
Rs 14,873 crore allocated for JNNURM; JNNURM will help in purchase of 10,000 buses by hilly stations
4% farm loan scheme extended to private sector banks
Rs 9,954 crore and Rs 2,250 crore for crop diversification under different schemes
Rs 7,00,000 crore for agricultural credit schemes
Rs 3,400 crore for agricultural research
Rs 80,194 crore allocation for Ministry of Rural Development in 2013-14; About Rs 33,000 crore for MGNREGA
Rs 13,215 crore to be provided for mid-day meal scheme
Rs 24,598 core allocatec to the tribal sub-plan
Rs 1,400 crore for water purification
Additional sum of Rs 200 crore to Women and Child Welfare Ministry to address issues of vulnerable women.
Rs 27,257 crore to Sarva Shiksha Aviyan
Rs. 65,867 crore allocated to Ministry of HRD in 2013-14
Rs 65,867 cr allocated to ministry of human resources
Medical colleges in six more AIIMS-like institutions to start functioning this year; Rs 1650 crore allocated for the purpose
Rs 4,727 crore for medical research
Rs 110 crore to dept of disability affairs under specific scheme
Rs 37,330 crore allocated for Ministry of Health & Family Welfare
Rs 3,511 crore to minority affairs
Rs 41,000 crore for Scheduled Caste and Rs 28,500 crore for tribal welfare
Battle against inflation must be fought at all fronts: FM
Budget expenditure is Rs 16,65,297 crore and Plan expenditure Rs 5,55, 322 crore
Plan expenditure in 12th Five Year Plan revised to Rs 14,30,825 crore or 96 per cent of budgeted expenditure.
We have brought down headline WPI inflation to 7 per cent and core inflation to 4.2 per cent
Economic space constrains due to high fiscal deficit, lower savings and investment and tight monetary policy, says minister
Average economic growth rate in 11th Plan period is 8%, highest ever in any Plan period: FM
Current year’s economic growth rate will be below India’s potential growth rate of 8 per cent: FM
FM: Food inflation remains a worry
Faced with huge fiscal deficit, I have no choice but to rationalise expenditure: FM
Core inflation is down to 4.2 per cent, says the minister
India does not have choice between welcoming and spurning foreign investment; it is an imperative: Chidambaram
FM: Encouragement of foreign investment in line with our economic objectives is a must
Current account deficit continues to be high due to excessive dependence on oil, coal and gold imports and slowdown in exports
FM: Current account deficit is a bigger worry and fuel and gold imports responsible
Without growth, there will be no inclusiveness and development, says Chidambaram
FM: Achieving high growth is not a novelty
Only China and Malayasia are the major countries that grew faster than India last year: FM

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