Highlights of Budget 2008-09

Union Minister for Finance P Chidambaram presented the Union Budget for 2008-09 in the Lok Sabha, announcing a waiver of agricultural loans to the tune of Rs 60,000 crore, raised the income tax exemption threshold to Rs 1,50,000 and slashed customs and excise duties on variety of goods. Presenting his fifth and last full-fledged budget, he also withdrew the controversial banking cash transaction tax but introduced a Commodities Transaction Tax on the lines of Securities Transaction Tax on options and futures. The Central Sales Tax was reduced from three to two per cent. Under the income tax proposals that will give a minimum relief of Rs 4,000 to all assessees, incomes between Rs 1,50,001 and Rs 3,00,000 will be 10 per cent, those between Rs 3,00,001 and Rs 5,00,000 will be 20 per cent and above Rs 5,00,001 will be 30 per cent. Senior citizens will pay no tax up to Rs 2,25,000 and women up to Rs 1,80,000. There will be no change in the corporate income tax or the surcharge rate. While Chidambaram's direct tax proposals are revenue neutral, those on the indirect taxes side are estimated to result in a loss of Rs 5,900 crore. Raising the Defence budget by 10 per cent from Rs 95,000 crore to Rs 105,600 crore in the coming year, the estimates of Plan expenditure have been fixed at Rs 2,43,386 crore which will be Rs 32.4 per cent of the total expenditure. Non-Plan expenditure has been estimated at Rs 5,07,498 crore. The revenue deficit for the current year will be 1.4 per cent against the budget estimates of 1.5 per cent and the fiscal deficit will be 3.1 per cent against an estimate of 3.3 per cent. The salient features of the Budget are: * Sarva Shiksha Abhiyan will be provided Rs 13,100 crore, Mid Day Meal scheme Rs 8,000 crore, Secondary education Scheme Rs 4,554 crore. * 410 additional Kasturba Gandhi Vidyalaya to be set up in backward blocks. * Navodaya Vidyalayas to be opened in 20 districts with special focus on regions having SC/ST concentration. * Allocation of Rs 130 crore for this purpose. Rs.750 crore more to be given for merit scholarship to students up to 10th and 12th class. * Mid day Meal scheme extended to upper primary level in 3479 schools. 16 central universities to be opened in 2008-09. * Three IITs to be set up in Andhra Pradesh, Bihar and Rajasthan. * Schools of architecture and planning in Bhopal and Vijaywada. More institutes of higher education to be opened. * Rs 100 crore to be given to Information Technology Ministry to set up national knowledge centres. * Allocation for NRHM increased to Rs 12,050 crore * Rs 992 crore for national AIDS programme. * A national programme for the elderly to be started at a cost of Rs. 400 crore. * Rashtra Swasthya Beema Yojana to start from April one in Delhi and Haryana. Rs 30,000 for each family belonging to unorganised sector. * Allocation for ICDS increased to Rs 6300 crore. * Rs 85 crore sanctioned for scholarships to students pursuing science education. * Indian Institutes of Science Education and Research to be set up at Bhopal and Thiruvananthapuram. * Agriculture credit doubled in the first two years of the government to reach Rs.2.40 lakh crore by March 2008. * Eleventh Plan started on a robust growth. * Gross budgetary support to be raised to Rs 2,43,386 crore, an increase of more than Rs 38,000 crore from the current level. * Allocation for Bharat Nirman to be raised to Rs 31,280 crore. * Twenty per cent hike in education budget this year from Rs 28,674 crore to Rs 34,400 crore. * GDP growth slows down to 8.4 per cent during quarter ended December 31, 2007 as compared to 9.1 per cent a year ago. * Economy grew over eight per cent over 12 successive quarters since 2005, says Finance Minister P Chidambaram. * Growth rate of agricultre extimated at 2.6 per cent during the current year. * Services and manufacturing sectors expected to grow by 10.7 per cent and 9.4 per cent, says Chidambaram. * Keeping inflation under check is one of the cornerstones of the Government's policy. * Rice production estimiated at 94.08 million tonnes, maize 16.78 mt, soyabean 9.45 mt and cotton 23.38 million bales.

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