Is India a poor Country? See prime Minister's demand:
N.K.Assumi
(Querist) 22 October 2008
This query is : Resolved
WHY WORRY WITH GLOBAL FINANCIAL TURMOIL?
Centre to pump in Rs 105.6 k cr more
Tue, Oct 21 02:52 AM
The government on Monday sought Rs 1,05,613.38 crore extra funds in its biggest ever supplementary demand for grants tabled in the Lok Sabha on Monday. These funds under the first batch of supplementary demands for 2008-09, will be used to provide fertiliser and food subsidies, oil bonds, increase in salaries of civil servants, among others. The supplementary pegs the government's gross additional expenditure at Rs 2,37,285.84 crore for the remaining fiscal, while the Budget 2008-09 in February has estimated the entire year expenses at Rs 7,50,883.53 crore.
The financial contribution of various ministries in the form of savings and receipts are expected at Rs 1,31,672.29 crore, resulting in a net cash outgo of Rs 1,05,613 crore. The fertiliser sector will get the biggest subsidy amount of Rs 38865.56 crore. Another Rs 65,942 crore are being raised issue of bonds to oil market companies for meeting their under recoveries on account of sale of petroleum products below market prices.
The government will credit Rs 15,000 crore in the Farmers Debt Relief Fund. The first installment of Rs 25,000 of the farm loan waiver has already been released to the banks from the Public Accounts of India. Thus the net cash outgo on account of the farm loan waiver will be only Rs 15,000 crore, the supplementary said.
Rs 10,500 crore has been demanded for expenses on the National Rural Employment Guarantee scheme. The government will also pay Rs 2912.67 to the International Monetary Fund as capital payment for increase in India's quota at the institution. The government sought Rs 4,064 crore for foodgrain subsidy to the Food Corporation of India and another Rs 1000 crore for subsidies on imported edible oils.
The demand could result in bigger borrowings, putting pressure on the government finances, analysts say. The finance ministry further sought the parliament's approval for restructuring capital of state-run Punjab & Sind Bank and UCO Bank. The supplementary demand for grants showed that the government plans to convert Rs 250 crore of UCO's equity into perpetual non-cumulative shares. It also plans to convert Rs 560 crore of equity in PSB into similar debt instruments - Rs 160 crore equity into innovative perpetutal debt under Tier-I, Rs 200 crore in perpetutal non-cumulative preference shares under Tier-I and another Rs 200 crore into perpetutal cumulative preference shares under Tier-II Capital. As restructuring of equity capital is involved in both cases and there is no cash outgo, the report said. The ministry demanded Rs 1,165 crore the department of disinvestment to reallocate funds to LIC Mutual Funds Assets Management, SBI India Funds Management Pvt Ltd and UTI Asset Management Company Pvt Ltd.
Another Rs 500 crore were sought for Social Security Fund of the LIC for providing 50% government share of premium under Janshree Bima Yojana. Some of the spending such as subsidies and farm debt waivers were provided in the budget in February, but the expenditure bill has gone up on some heads like fertiliser and food subsidies. The government is also under
pressure to woo voters ahead of local polls in some states and national election due by May next year.
All bank deposits are safe, nothing to fear: PM
Mon, Oct 20 05:07 PM
India's economic growth may decelerate to 7.5 per cent in 2008/09, as the country experienced 'ripple effects' of the global financial crisis and liquidity crunch, Prime Minister Manmohan Singh said on Monday.
"The financial crisis is likely to have an indirect impact on the Indian economy," he said in a statement to lawmakers in Parliament. "We must be prepared for a temporary slowdown in the Indian economy."
"RBI and the government are carefully monitoring flow of credit and will ensure additional liquidity results in actual credit," the PM said.
The Prime Minister assured t
ARVIND JAIN
(Expert) 22 October 2008
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