NEW DELHI: Finance Minister P. Chidambaram presented one of the most highly anticipated Indian budgets of recent years on Thursday, as the government looks to rein in a bloated fiscal deficit and restore confidence in Asia’s third-largest economy.
FISCAL DEFICIT
* Faced with huge fiscal deficit, India had no choice but to rationalise expenditure
GROWTH
* India faces challenge of getting back to its potential growth rate of 8 pct
* India must unhesitatingly embrace growth as highest goal
SPENDING
* Total budget expenditure seen at 16.65 trillion rupees in 2013/14
* India’s 2013/14 plan expenditure seen at 5.55 trillion rupees
* Revised estimate for total expenditure is 14.3 trillion rupees in 2012/13, which is 96 pct of budget estimate
* Set aside 100 billion rupees towards spending on food subsidies in 2013/14
CURRENT ACCOUNT DEFICIT
* India’s greater worry is the current account deficit – will need more than $75 billion this year and next year to fund deficit
INFLATION
* Food inflation is worrying, will take all steps to augment supply side
CORPORATE SECTOR AND MARKETS
* Plans to issue inflation-indexed bonds
* Proposes capital allowance of 15 pct to companies on investments of more than 1 billion rupees
* To implement quickly recommendations of financial sector legislative reforms commission
POWER AND ENERGY SECTOR
* Proposes zero customs duty for electrical plants and machinery
* Proposes to move to revenue-sharing from profit-sharing policy in oil and gas sector
BANKING
* To provide 140 billion rupees capital infusion in state-run banks in 2013/14
AGRICULTURE
* To allocate 801.94 billion rupees to rural development in 2013/14
* Plan to allocate 270.49 billion rupees for agriculture in 2013/14
FINANCE MINISTER COMMENTS
* “Faced with a huge fiscal deficit, I have no choice but to rationalize expenditure. We took a dose of bitter medicine. It seems to be working.” REUTERS
