Budget 2012-2013

Speech of

Pranab Mukherjee
Minister of Finance March 16, 2012

Madam Speaker, I rise to present the Union Budget for 2012-13. For the Indian e ono!", this #as a "ear of re o$er" interrupted. %hen one "ear ago, I rose to present the Budget, the ha&&enges #ere !an", but there #as a sense that the #or&d e ono!" #as on the !end. 'he Budget #as presented in the first g&i!!er of hope. But rea&it" turned out to be different. 'he so$ereign debt risis in the (uro )one intensified, po&iti a& tur!oi& in Midd&e (ast inje ted #idespread un ertaint", rude oi& pri es rose, an earth*uake stru k +apan and the o$era&& g&oo! refused to &ift. 2. %hi&e I be&ie$e that there shou&d be no roo! for o!p&a en ", nor an" e, use for #hat happens in one-s o#n ountr", #e #i&& be !is&ed if #e ignore the ground rea&ities of the #or&d. 'he g&oba& risis has affe ted us. India-s .ross /o!esti Produ t 0./P1 is esti!ated to gro# b" 2.3 per ent in 2011-12, after ha$ing gro#n at the rate of 4.5 per ent in ea h of the t#o pre eding "ears. 'hough #e ha$e been ab&e to &i!it the ad$erse i!pa t of this s&o#do#n on our e ono!", this "ear-s perfor!an e has been disappointing. But it is a&so a fa t that in an" rossountr" o!parison, India sti&& re!ains a!ong the front runners in e ono!i gro#th. 3. For the better part of the past t#o "ears, #e had to batt&e near doub&e-digit head&ine inf&ation. 6ur !onetar" and fis a& po&i " response during this period #as geared to#ards ta!ing do!esti inf&ationar" pressures. 7 tight !onetar" po&i " i!pa ted in$est!ent and onsu!ption gro#th. 'he fis a& po&i " had to absorb e,panded out&a"s on subsidies and dut" redu tions to &i!it the pass-through of higher fue& pri es to onsu!ers. 7s a resu&t gro#th !oderated and the fis a& ba&an e deteriorated. 4. But there is good ne#s in the detai&. %ith agri u&ture and ser$i es ontinuing to perfor! #e&&, India-s s&o#do#n an be attributed a&!ost entire&" to #eak industria& gro#th. %hi&e #e do not ha$e aggregate figures for the &ast *uarter of 2011-12, nu!erous indi ators pertaining to this period suggest that the e ono!" is no# turning around. 'here are signs of re o$er" in oa&, ferti&isers, e!ent and e&e tri it" se tors. 'hese are ore se tors that ha$e an i!pa t on the entire e ono!". Indian !anufa turing appears to be on the usp of a re$i$a&.

5. %e are no# at a jun ture #hen it is ne essar" to take hard de isions. %e ha$e to i!pro$e our !a roe ono!i en$iron!ent and strengthen do!esti gro#th dri$ers to sustain high gro#th in the !ediu! ter!. %e ha$e to a e&erate the pa e of refor!s and i!pro$e supp&" side !anage!ent of the e ono!". 6. %e are about to enter the first "ear of the '#e&fth Fi$e 8ear P&an #hi h ai!s at 9faster, sustainab&e and !ore in &usi$e gro#th.: 'he P&an #i&& be &aun hed #ith the Budget proposa&s for 2012-13. In keeping #ith the stated priorities, I ha$e identified fi$e obje ti$es that #e !ust address effe ti$e&" in the ensuing fis a& "ear. 'hese are; < < < < < Fo us on do!esti de!and dri$en gro#th re o$er"= >reate onditions for rapid re$i$a& of high gro#th in pri$ate in$est!ent= 7ddress supp&" bott&ene ks in agri u&ture, energ" and transport se tors, parti u&ar&" in oa&, po#er, nationa& high#a"s, rai&#a"s and i$i& a$iation= Inter$ene de isi$e&" to address the prob&e! of !a&nutrition espe ia&&" in the 200 high-burden distri ts= and (,pedite oordinated i!p&e!entation of de isions being taken to i!pro$e de&i$er" s"ste!s, go$ernan e, and transparen "= and address the prob&e! of b&a k !one" and orruption in pub&i &ife.

7. 'oda", India has g&oba& responsibi&ities of a kind that it did not ha$e ear&ier. 6ur presen e at the high tab&e of g&oba& e ono!i po&i " !akers is a !atter of so!e satisfa tion. It, ho#e$er, p&a es ne# responsibi&ities on our shou&ders. If India an ontinue to bui&d on its e ono!i strength, it an be a sour e of stabi&it" for the #or&d e ono!" and pro$ide a safe destination for rest&ess g&oba& apita&. 8. I kno# that !ere #ords are not enough. %hat #e need is a redib&e road!ap ba ked b" a set of i!p&e!entab&e proposa&s to !eet those obje ti$es. In !" atte!pt to do so, I ha$e benefited fro! the ab&e guidan e of ?on-b&e Pri!e Minister, /r. Man!ohan @ingh, and strong support of the UP7 >hairperson @!t. @onia .andhi. I #ou&d no# begin #ith a brief o$er$ie# of the e ono!".

O er !e" of the #co$om%

&. 8esterda", I &aid on the tab&e of the ?ouse the ( ono!i @ur$e" 2011-12, #hi h gi$es a detai&ed ana&"sis of the e ono!" o$er the past 12 !onths. India-s ./P is esti!ated to gro# at 2.3 per ent in rea& ter!s in 2011-12. 'he gro#th is esti!ated to be 2.A per ent in agri u&ture, 3.3 per ent in industr" and 3.5 per ent in ser$i es. 'here is a signifi ant s&o#do#n in o!parison to the pre eding t#o "ears, pri!ari&" due to de e&eration in industria& gro#th, !ore spe ifi a&&" in pri$ate in$est!ent. Bising ost of redit and #eak do!esti business senti!ent, added to this de &ine.

10. 'he head&ine inf&ation re!ained high for !ost part of the "ear. It #as on&" in /e e!ber 2011 that it !oderated to 4.3 per ent fo&&o#ed b" 2.2 per ent in +anuar" 2012. Month&" food inf&ation de &ined fro! 20.2 per ent in Februar" 2010, to 3.5 per ent in Mar h 2011 and turned negati$e in +anuar" 2012. 'hough the Februar" 2012 inf&ation figure has gone up !argina&&", I e,pe t the head&ine inf&ation to !oderate further in the ne,t fe# !onths and re!ain stab&e thereafter. 11. India-s inf&ation is &arge&" stru tura&, dri$en predo!inant&" b" agri u&tura& supp&" onstraints and g&oba& ost push. ($iden e suggests that pro&onged periods of high food inf&ation tend to get genera&ised. Fortunate&", steps taken to bridge gaps in distribution, storage and !arketing s"ste!s to strengthen food supp&" hains ha$e he&ped us in a !ore effe ti$e !anage!ent of inf&ation and &ed to a de &ine in food inf&ation. 12. 'he de$e&op!ents in India-s e,terna& trade in the first ha&f of the urrent "ear #ere en ouraging. /uring 7pri&-+anuar" 2011-12, e,ports gre# b" 23 per ent to rea h U@ /o&&ar 253 bi&&ion, #hi&e i!ports at U@ /o&&ar 331 bi&&ion re orded a gro#th of o$er 23 per ent. %hat is heartening is that India has su essfu&&" a hie$ed di$ersifi ation of e,port and i!port !arkets. 'he share of 7sia, in &uding 7@(7C, in tota& trade in reased fro! 33.3 per ent in 2000-2001 to AD.3 per ent in the first ha&f of 2011-12. 'his has he&ped us #eather the i!pa t of g&oba& risis e!anating fro! (urope and to a &esser e,tent fro! U@7. 13. 'he urrent a ount defi it as a proportion of ./P for 2011-12 is &ike&" to be around 3.2 per ent. 'his, a&ong #ith redu ed net apita& inf&o#s in the se ond and third *uarters, put pressure on the e, hange rate. 14. 'aking a bird-s e"e $ie# of the entire e ono!" and keeping in !ind the diffi u&t g&oba& en$iron!ent, I e,pe t India-s ./P gro#th in 2012-13 to be D.2 per ent, EF- 0.2A per ent. 15. I e,pe t a$erage inf&ation to be &o#er ne,t "ear. I a&so e,pe t the urrent a ount defi it to be s!a&&er, aided b" i!pro$e!ent in do!esti finan ia& sa$ings.

''. (ro"th
I no# turn to gro#th and fis a& onso&idation. 16. 6ur fis a& ba&an e has deteriorated in 2011-12 due to s&ippage in dire t ta, re$enue and in reased subsidies. 6n both ounts our under&"ing assu!ptions at the ti!e of Budget presentation &ast "ear #ere be&ied b" subse*uent de$e&op!ents. 'he profit !argins a!e under pressure due to higher interest rates and !ateria& osts. 'his i!pa ted gro#th in orporate ta,es. Further, as against an assu!ption of U@ /o&&ar 30 a barre&, the a$erage pri e of rude oi& in 2011-12 is &ike&" to e, eed U@ /o&&ar 11A. 'his has ne essitated higher out&a" on subsidies than proje ted. 'he ontinuing un ertaint" in the g&oba& en$iron!ent !akes it ne essar" for us to strike a ba&an e bet#een fis a& onso&idation and strengthening !a roe ono!i funda!enta&s to reate ade*uate headroo! to dea& #ith future sho ks. )!*ca+ ,o$*o+!dat!o$ FRBM Act

17. 'he i!p&e!entation of the Fis a& Besponsibi&it" and Budget Manage!ent 7 t, 2003 0FBBM 7 t1 at >entre and the orresponding 7 ts at @tate &e$e& #as the pi$ot in the su essfu& onso&idation of our fis a& ba&an e prior to the g&oba& finan ia& risis of 2004. 'he outbreak of the risis oin ided #ith the "ear #hen the !andated targets of 3 per ent fis a& defi it and e&i!ination of re$enue defi it #ere to be a hie$ed. 'he .o$ern!ent had to de$iate fro! these targets due to inje tion of fis a& sti!u&us at that ti!e. Fo&&o#ing !" announ e!ent in the &ast Budget @pee h, I a! no# introdu ing a!end!ents to the FBBM 7 t as part of Finan e Bi&&, 2012. Expenditure Reforms 18. 'he fis a& targets for >entre under the a!end!ents to the FBBM 7 t are indi ated in the Budget do u!ents. Mean#hi&e, I #ou&d &ike to high&ight t#o of its features that are steps in the dire tion of e,penditure refor!s. First, the on ept of (ffe ti$e Be$enue /efi it, introdu ed in the &ast Budget, to address the stru tura& i!ba&an es in the re$enue a ount, is being brought in as a fis a& para!eter. (ffe ti$e Be$enue /efi it is the differen e bet#een re$enue defi it and grants for reation of apita& assets. Fo using on this #i&& he&p in redu ing the onsu!pti$e o!ponent of re$enue defi it and reate spa e for in reased apita& spending. 1&. @e ond, a pro$ision for 9Mediu!-ter! (,penditure Fra!e#ork @tate!ent: is being introdu ed in the 7 t. 'his state!ent sha&& set forth a three-"ear ro&&ing target for e,penditure indi ators. It #ou&d he&p in undertaking a de-no$o e,er ise for a&&o ating resour es for prioritised s he!es and #eeding out others that ha$e out&i$ed their uti&it". 'his #ou&d pro$ide greater ertaint" in !u&ti-"ear budgeting fra!e#ork. It #ou&d a&so en ourage effi ien ies in e,penditure !anage!ent. 20. In i!p&e!enting the '#e&fth P&an, the re o!!endations !ade b" the (,pert >o!!ittees to strea!&ine and redu e the nu!ber of >entra&&" @ponsored @ he!es and to address P&an and non-P&an &assifi ation, #ou&d be kept in $ie#. 'he >entra& P&an @ he!e Monitoring @"ste! #ou&d be e,panded to fa i&itate better tra king and uti&isation of funds re&eased b" the >entra& .o$ern!ent. Subsidies 21. Fis a& onso&idation a&&s for efforts both to raise the ta,-./P ratio and to &o#er the e,penditure. In this onte,t, #e need to take a &ose &ook at the gro#th of our re$enue e,penditure, parti u&ar&" on subsidies. 'he !ajor subsidies at the >entre are for food, ferti&isers and petro&eu! produ ts. @o!e subsidies at this jun ture in our de$e&op!ent are ine$itab&e. But the" be o!e undesirab&e if the" o!pro!ise the !a roe ono!i funda!enta&s of the e ono!", !ore so, #hen the" don-t rea h the intended benefi iaries. 22. 'he .o$ern!ent has de ided that fro! 2012-13 subsidies re&ated to food and for ad!inistering the Food @e urit" 7 t #i&& be fu&&" pro$ided for. 7&& other subsidies #ou&d be funded to the e,tent that the" an be borne b" the e ono!" #ithout an" ad$erse i!p&i ations. It #ou&d be !" endea$our to restri t the e,penditure on >entra& subsidies to under 2 per ent of ./P in 2012-13. 6$er the ne,t three "ears, it #ou&d be further brought do#n to 1.DA per ent of ./P. @u h a step is needed to i!pro$e the *ua&it" of pub&i spending. 6ur effort no# #i&& be dire ted to#ards better targeting and &eakage proof de&i$er" of the subsidies.

23. 'he re o!!endations of the task for e headed b" @hri Candan Ci&ekani on I' strateg" for dire t transfer of subsid" ha$e been a epted. Based on these re o!!endations, a !obi&ebased Ferti&iser Manage!ent @"ste! 0!FM@1 has been designed to pro$ide end-to-end infor!ation on the !o$e!ent of ferti&isers and subsidies, fro! the !anufa turer to the retai& &e$e&. 'his #i&& be ro&&ed out nation-#ide during 2012. /ire t transfer of subsid" to the retai&er, and e$entua&&" to the far!er #i&& be i!p&e!ented in subse*uent phases. 'his step #i&& benefit 12 rore far!er fa!i&ies, #hi&e redu ing e,penditure on subsidies b" urtai&ing !isuse of ferti&isers. 24. 7&& the three pub&i se tor 6i& Marketing >o!panies ha$e &aun hed GP. transparen " porta&s to i!pro$e usto!er ser$i e and redu e &eakage. 7 pi&ot proje t for se&&ing GP. at !arket pri e and rei!burse!ent of subsid" dire t&" into the benefi iar"-s bank a ount is being ondu ted in M"sore. 7 si!i&ar pi&ot proje t on dire t transfer of subsid" for kerosene into the bank a ounts of benefi iaries has been initiated in 7&#ar distri t of Bajasthan. 'he 7adhaar p&atfor! has a&so been su essfu&&" used to $a&idate P/@ ration ards in +harkhand. 25. 'hese pi&ot proje ts sho# that substantia& e ono!ies in subsid" outgo an be a hie$ed b" the use of 7adhaar p&atfor!. It #i&& be our endea$our to s a&e up and ro&& out these 7adhaar enab&ed pa"!ents for $arious go$ern!ent s he!es in at &east A0 se&e ted distri ts #ithin the ne,t si, !onths. Tax Reforms 26. 7s ?on-b&e Me!bers are a#are, the /ire t 'a,es >ode 0/'>1 Bi&& #as introdu ed in Par&ia!ent in 7ugust 2010. It #as our earnest desire to gi$e effe t to /'> fro! 7pri& 1, 2012. ?o#e$er, #e re ei$ed the Beport of the Par&ia!entar" @tanding >o!!ittee on Mar h 3, 2012. %e #i&& e,a!ine the report e,peditious&" and take steps for the ena t!ent of /'> at the ear&iest. 27. @i!i&ar&", the >onstitution 7!end!ent Bi&&, a preparator" step in the i!p&e!entation of .oods and @er$i es 'a, 0.@'1 #as introdu ed in Par&ia!ent in Mar h 2011 and is before the Par&ia!entar" @tanding >o!!ittee. 7s #e a#ait re o!!endations of the >o!!ittee, drafting of !ode& &egis&ation for >entre and @tate .@' in on ert #ith @tates is under progress. 28. 'he stru ture of .@' Cet#ork 0.@'C1 has been appro$ed b" the (!po#ered >o!!ittee of @tate Finan e Ministers. .@'C #i&& be set up as a Cationa& Infor!ation Uti&it" and #i&& be o!e operationa& b" 7ugust 2012. 'he .@'C #i&& i!p&e!ent o!!on P7C-based registration, returns fi&ing and pa"!ents pro essing for a&& @tates on a shared p&atfor!. 'he use of P7C as a o!!on identifier in both dire t and indire t ta,es, #i&& enhan e transparen " and he k ta, e$asion. I so&i it the support of a&& !" o&&eagues utting a ross part" &ines for an ear&" passage of these &and!ark &egis&ations. Disinvestment Policy 2&. 'he .o$ern!ent has further e$o&$ed its approa h to di$est!ent of >entra& Pub&i @e tor (nterprises 0>P@(s1. 'he >P@(s are being gi$en a &e$e& p&a"ing fie&d $is-a-$is the pri$ate se tor #ith regard to pra ti es &ike bu"-ba ks and &isting at sto k e, hange. 'he treasur" !anage!ent

options for >P@(s ha$e a&so been enhan ed. 'his #i&& he&p i!pro$e the returns on pub&i assets, support transparent en$iron!ent for the di$est!ent pro ess, besides un&o king the $a&ue and resour es for a&& stakeho&ders. 30. In 2011-12, as against a target of ` 50,000 rore, the .o$ern!ent #i&& raise about ` 15,000 rore fro! disin$est!ent. For 2012-13, I propose to raise ` 30,000 rore through disin$est!ent. Get !e reiterate here that #hi&e #e are o!!itted to enhan ing peop&e-s o#nership of >P@(s, at &east A1 per ent o#nership and !anage!ent ontro& #i&& re!ain #ith the .o$ern!ent. Stre$gthe$!$g '$ e*tme$t #$ !ro$me$t 31. 'he do!esti in$est!ent en$iron!ent has suffered on !u&tip&e ounts in the past "ear. It is ti!e to fast tra k po&i " de isions and ensure on-ti!e i!p&e!entation of !ajor proje ts. Foreign Direct nvestment 32. 6rganised retai& he&ps in redu ing ost of inter!ediation due to e ono!ies of s a&e, benefiting both onsu!ers and produ ers. 7t present, F/I in sing&e brand and in ash and arr" #ho&esa&e trade is per!itted to the e,tent of 100 per ent. 'he de ision in respe t of a&&o#ing F/I in !u&ti-brand retai& trade up to A1 per ent, subje t to o!p&ian e #ith spe ified onditions, has been he&d in abe"an e. (fforts are on to arri$e at a broad based onsensus in onsu&tation #ith the @tate .o$ern!ents. Advance Pricing Agreement 33. In a g&oba&ised e ono!" #ith e,panding ross-border produ tion hains and gro#ing trade #ithin entities of the sa!e group, 7d$an e Pri ing 7gree!ent 07P71 an signifi ant&" bring do#n ta, &itigation and pro$ide ta, ertaint" to foreign in$estors. 'hough, the pro$ision for 7P7 has been in &uded in the /'> Bi&&, 2010, I propose to bring for#ard its i!p&e!entation b" introdu ing it in the Finan e Bi&&, 2012. Financial Sector 34. Befor!s in the finan ia& se tor ha$e been pursued #ith the obje ti$e of !ore effi ient !arket inter!ediation bet#een sa$ers and in$estors. 35. 'o en ourage f&o# of sa$ings in finan ia& instru!ents and i!pro$e the depth of do!esti apita& !arket, it is proposed to introdu e a ne# s he!e a&&ed Baji$ .andhi (*uit" @a$ings @ he!e. 'he s he!e #ou&d a&&o# for in o!e ta, dedu tion of A0 per ent to ne# retai& in$estors, #ho in$est up to ` A0,000 dire t&" in e*uities and #hose annua& in o!e is be&o# ` 10 &akh. 'he s he!e #i&& ha$e a &o k-in period of 3 "ears. 'he detai&s #i&& be announ ed in due ourse. !apital Mar"ets

36. /uring the "ear 2011-12, #e took a series of steps to deepen the apita& !arket and en ourage in$est!ent in infrastru ture se tor. 'hese steps in &uded raising of FII in$est!ent &i!it in &ong-ter! infrastru ture bonds, orporate bonds and go$ern!ent se urities. 'he &i!it on (,terna& >o!!er ia& Borro#ings 0(>B1 #as a&so raised and *ua&ified foreign in$estors #ere a&&o#ed to in$est in spe ified Indian !utua& funds and dire t&" in e*uities. 37. I no# propose to take the ne,t steps in deepening the refor!s in >apita& !arket b"; < < 7&&o#ing Hua&ified Foreign In$estors 0HFIs1 to a ess Indian >orporate Bond !arket= @i!p&if"ing the pro ess of issuing Initia& Pub&i 6ffers 0IP6s1, &o#ering their osts and he&ping o!panies rea h !ore retai& in$estors in s!a&& to#ns. 'o a hie$e this, in addition to the e,isting IP6 pro ess, I propose to !ake it !andator" for o!panies to issue IP6s of ` 10 rore and abo$e in e&e troni for! through nation#ide broker net#ork of sto k e, hanges= Pro$iding opportunities for #ider shareho&der parti ipation in i!portant de isions of the o!panies through e&e troni $oting fa i&ities, besides e,isting pro ess for shareho&der $oting, #hi h #ou&d be !ade !andator" initia&&" for top &isted o!panies= and Per!itting t#o-#a" fungibi&it" in Indian /epositor" Be eipts subje t to a ei&ing #ith the obje ti$e of en ouraging greater foreign parti ipation in Indian apita& !arket.

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#egislative Reforms 38. %e ha$e re ei$ed the re o!!endations of the @tanding >o!!ittee on Finan e on 9'he Pension Fund Begu&ator" and /e$e&op!ent 7uthorit" Bi&&, 2011:, 9'he Banking Ga#s 07!end!ent1 Bi&&, 2011: and 9'he Insuran e Ga#s 07!end!ent1 Bi&&, 2004:. 'he offi ia& a!end!ents to these Bi&&s #i&& be !o$ed in this session of the Par&ia!ent. 3&. 'o take for#ard the pro ess of finan ia& se tor &egis&ati$e refor!s, the .o$ern!ent proposes to !o$e the fo&&o#ing Bi&&s in the Budget @ession of the Par&ia!ent; < < < < < < < 'he Mi ro Finan e Institutions 0/e$e&op!ent and Begu&ation1 Bi&&, 2012= 'he Cationa& ?ousing Bank 07!end!ent1 Bi&&, 2012= 'he @!a&& Industries /e$e&op!ent Bank of India 07!end!ent1 Bi&&, 2012= Cationa& Bank for 7gri u&ture and Bura& /e$e&op!ent 07!end!ent1 Bi&&, 2012= Begiona& Bura& Banks 07!end!ent1 Bi&&, 2012= Indian @ta!p 07!end!ent1 Bi&&, 2012= and Pub&i /ebt Manage!ent 7gen " of India Bi&&, 2012.

40. 'he (nfor e!ent of @e urit" Interest and Be o$er" of /ebts Ga#s 07!end!ent1 Bi&&, 2011 has a&read" been introdu ed in Par&ia!ent. !apitalisation of Ban"s and Financial $olding !ompany 41. 'he .o$ern!ent is o!!itted to prote t the finan ia& hea&th of Pub&i @e tor Banks and finan ia& institutions. For the "ear 2012-13, I propose to pro$ide ` 1A,444 rore for apita&isation of Pub&i @e tor Banks, Begiona& Bura& Banks and other finan ia& institutions in &uding C7B7B/. 'he .o$ern!ent is a&so e,a!ining the possibi&it" of reating a finan ia& ho&ding o!pan" #hi h #i&& raise resour es to !eet the apita& re*uire!ents of Pub&i @e tor Banks. 42. 'o bring banking pa"!ent stru ture at par #ith g&oba& standards, a o!prehensi$e a tion p&an has been prepared for i!p&e!entation in 2012-13. 7 entra& Ino# 8our >usto!er 0I8>1 depositor" #i&& be de$e&oped in 2012-13 to a$oid !u&tip&i it" of registration and data upkeep. Priority Sector #ending 43. 7 o!!ittee set up b" BBI to re-e,a!ine the e,isting &assifi ation and suggest re$ised guide&ines on priorit" se tor &ending has sub!itted its report. 7fter stakeho&der onsu&tation, re$ised guide&ines #i&& be issued. Financial nclusion 44. In 2010-11, 9@#abhi!aan: a!paign #as &aun hed to e,tend banking fa i&ities through Business >orrespondents to habitations ha$ing popu&ation in e, ess of 2000. I a! happ" to announ e that out of D3,000 identified habitations that #ere to be o$ered b" Mar h, 2012, about D0,000 habitations ha$e been pro$ided #ith banking fa i&ities. %ith this, o$er 2.AA rore benefi iar" a ounts #ou&d ha$e been operationa&ised. 'he re!aining habitations are &ike&" to be o$ered b" Mar h 31, 2012. 7s a ne,t step, U&tra @!a&& Bran hes are being set up at these habitations, #here the Business >orrespondents #ou&d dea& #ith ash transa tions. 45. In 2012-13, I propose to e,tend the 9@#abhi!aan: a!paign to habitations #ith popu&ation of !ore than 1000 in Corth (astern and hi&&" @tates and to other habitations #hi h ha$e rossed popu&ation of 2,000 as per >ensus 2011. Regional Rural Ban"s 46. Begiona& Bura& Banks 0BBBs1 ha$e p&a"ed a ru ia& ro&e in !eeting the redit needs of rura& areas. I a! happ" to infor! that of the 42 BBBs in India, 41 ha$e su essfu&&" !igrated to >ore Banking @o&utions 0>B@1 and ha$e a&so joined the Cationa& (&e troni Fund 'ransfer s"ste!. 47. 'he .o$ern!ent had initiated the pro ess of apita&isation of 50 finan ia&&" #eak BBBs, #hi h has been o!p&eted in respe t of 12 BBBs b" the end of Februar", 2012. I propose to e,tend the s he!e of apita&isation of #eak BBBs b" another 2 "ears to enab&e a&& the @tates to ontribute their share.

'''. '$fra*tructure a$d '$du*tr!a+ -e e+opme$t

Get !e no# turn to infrastru ture and industria& de$e&op!ent.

48. Ga k of ade*uate infrastru ture is a !ajor onstraint on our gro#th. 'he strateg" #e ha$e fo&&o#ed so far is to in rease in$est!ent in infrastru ture through a o!bination of pub&i in$est!ent and pub&i pri$ate partnerships 0PPP1. /uring the '#e&fth P&an period, infrastru ture in$est!ent #i&& go up to ` A0 &akh rore. 7bout ha&f of this is e,pe ted to o!e fro! pri$ate se tor. 4&. Jiabi&it" .ap Funding 0J.F1 under the @ he!e for @upport to PPP in infrastru ture is an i!portant instru!ent in attra ting pri$ate in$est!ent into the se tor. 'his "ear it has been de ided to !ake irrigation 0in &uding da!s, hanne&s and e!bank!ents1, ter!ina& !arkets, o!!on infrastru ture in agri u&ture !arkets, soi& testing &aboratories and apita& in$est!ent in ferti&iser se tor e&igib&e for J.F under this s he!e. 6i& and .asFGC. storage fa i&ities and oi& and gas pipe&ines, fi,ed net#ork for te&e o!!uni ation and te&e o!!uni ation to#ers #i&& a&so be !ade e&igib&e se tors for J.F. 50. 'he .o$ern!ent has appro$ed guide&ines for estab&ishing joint $enture o!panies b" defen e Pub&i @e tor Undertakings in PPP !ode. 'his #i&& ser$e the dua& purpose of a hie$ing substanti$e se&f-re&ian e in the defen e se tor and produ tion of state-of-the-art defen e goods. 51. I had announ ed the setting up of Infrastru ture /ebt Funds to tap the o$erseas !arkets for &ong tenor pension and insuran e funds. I a! happ" to infor! the ?ouse that the first Infrastru ture /ebt Fund #ith an initia& si)e of `4000 rore, has been &aun hed ear&ier this !onth. 52. For the "ear 2011-12, ta,-free bonds for ` 30,000 rore #ere announ ed for finan ing infrastru ture proje ts. I propose to doub&e it to raise `20,000 rore in 2012-13. 'his in &udes `10,000 rore for C?7I, `10,000 rore for IBF>, `10,000 rore for IIF>G, `A,000 rore for ?U/>6, `A,000 rore for Cationa& ?ousing Bank, `A,000 rore for @I/BI, `A,000 rore for ports and `10,000 rore for po#er se tor. 53. 7 har!onised !aster &ist of infrastru ture se tor has been appro$ed b" the .o$ern!ent. 'his #i&& he&p in re!o$ing a!biguit" in the po&i " and regu&ator" do!ain and en ourage in$est!ent in the infrastru ture se tor. 54. 'o ease a ess of redit to infrastru ture proje ts, India Infrastru ture Finan e >o!pan" Gi!ited 0IIF>G1 has put in p&a e a stru ture for redit enhan e!ent and take-out finan e. 7 onsortiu! for dire t &ending and grant of in-prin ip&e appro$a& to de$e&opers before the sub!ission of bids for PPP proje ts has a&so been reated. %ational Manufacturing Policy 55. 'he .o$ern!ent has announ ed a Cationa& Manufa turing Po&i " on 6 tober 2A, 2011 #ith the obje ti$e of raising, #ithin a de ade, the share of !anufa turing in ./P to 2A per ent and reation of 10 rore jobs. 'he Po&i " en ourages the setting-up of Cationa& In$est!ent and Manufa turing Kones 0CIMKs1 a ross the ountr".

56. I #i&& no# address so!e issues that ha$e i!pa ted infrastru ture and industria& a ti$it" in the past !onths. Po&er and !oal 57. In po#er generation, fue& supp&" onstraints are affe ting produ tion prospe ts. 'o address this on ern, >oa& India Gi!ited 0>IG1 has been ad$ised to sign fue& supp&" agree!ents, #ith po#er p&ants that ha$e entered into &ong-ter! Po#er Pur hase 7gree!ents #ith /I@>6Ms and #ou&d get o!!issioned on or before Mar h 31, 201A. 7n inter-!inisteria& group is being onstituted to undertake periodi re$ie# of the a&&o ated oa& !ines and !ake re o!!endations on de-a&&o ations, if so re*uired. 58. I propose to a&&o# (,terna& >o!!er ia& Borro#ings 0(>B1 to part finan e Bupee debt of e,isting po#er proje ts. Transport' Roads and !ivil Aviation 5&. 'he Ministr" of Boad 'ransport and ?igh#a"s is set to a hie$e its target of a#arding proje ts o$ering a &ength of D,300 k! under C?/P during 2011-12. 'his #ou&d be 55 per ent higher than the best e$er &ength of A,042 k! a#arded in 2010-11. 6f the 55 proje ts a#arded during 2011-12, 25 proje ts ha$e fet hed a pre!iu!. I propose to set a target of o$ering a &ength of 4,400 k!s under C?/P ne,t "ear. 'he a&&o ation of the Ministr" has been enhan ed b" 15 per ent to ` 2A,320 rore in 2012-13. 60. 'o en ourage pub&i pri$ate partnerships in road onstru tion proje ts, I propose to a&&o# (>B for apita& e,penditure on the !aintenan e and operations of to&& s"ste!s for roads and high#a"s so &ong as the" are a part of the origina& proje t. 61. 'he air&ine industr" is fa ing finan ia& risis. 'he high operating ost of the se tor is &arge&" attributab&e to the ost of 7$iation 'urbine Fue& 07'F1. 'o redu e the ost of 7'F, .o$ern!ent has per!itted dire t i!port of 7'F b" Indian >arriers, as a tua& users. 62. 'o address the i!!ediate finan ing on erns of the >i$i& 7$iation se tor, I propose to per!it (>B for #orking apita& re*uire!ents of the air&ine industr" for a period of one "ear, subje t to a tota& ei&ing of U@ /o&&ar 1 bi&&ion. 63. 7 proposa& to a&&o# foreign air&ines to parti ipate up to 53 per ent in the e*uit" of an air transport undertaking engaged in operation of s hedu&ed and non-s hedu&ed air transport ser$i es is under a ti$e onsideration of the .o$ern!ent. Del(i Mumbai ndustrial !orridor 64. 'he /e&hi Mu!bai Industria& >orridor 0/MI>1 is being de$e&oped on either side a&ong the a&ign!ent of the %estern /edi ated Bai& Freight >orridor. 'he proje t has !ade signifi ant progress. In @epte!ber 2011, >entra& assistan e of `14,A00 rore spread o$er a period of A "ears has been appro$ed. 'he +apanese Pri!e Minister has announ ed U@L 5.A bi&&ion as +apanese parti ipation in /MI> proje t.

$ousing sector 65. In $ie# of the shortage of housing for &o# in o!e groups in !ajor ities and to#ns, I propose to; < < < < < Fertilisers 66. 'o redu e India-s i!port dependen e in urea, .o$ern!ent has taken steps to fina&ise pri ing and in$est!ent po&i ies for urea. It is e,pe ted that #ith the i!p&e!entation of the in$est!ent po&i ", ountr" #i&& be o!e se&f suffi ient in !anufa turing urea in the ne,t fi$e "ears. In ase of the potassi -phosphati 0PMI1 ferti&iser, use of sing&e super phosphate 0@@P1 #i&& be en ouraged through greater e,tension #ork. 'his ferti&iser is !anufa tured entire&" in the do!esti se tor. (nhan ed produ tion #ou&d bring do#n our dependen e on i!ports in the PMI se tor. Textiles 67. 'he .o$ern!ent has re ent&" announ ed a finan ia& pa kage of ` 3,445 rore for #ai$er of &oans of hand&oo! #ea$ers and their ooperati$e so ieties. 68. In addition to 5 !ega hand&oo! &usters a&read" operationa&ised, I a! no# happ" to announ e t#o !ore !ega &usters, one to o$er Prakasa! and .untur distri ts in 7ndhra Pradesh and the other for .odda and neighbouring distri ts in +harkhand. I a&so propose to pro$ide assistan e in setting up of dor!itories for #o!en #orkers in the A !ega &usters re&ating to hand&oo!, po#er &oo! and &eather se tors. 6&. 'he Ministr" of 'e,ti&es runs %ea$ers- @er$i e >entres in different parts of the ountr" for pro$iding te hni a& support to poor hand&oo! #ea$ers. I propose to set up three su h >entres, one ea h in Mi)ora!, Caga&and and +harkhand. I a! a&so happ" to announ e ` A00 rore pi&ot s he!e in the '#e&fth P&an for pro!otion and app&i ation of .eo-te,ti&es in the Corth (ast Begion. 70. 'o address the need of the &o a& artisans and #ea$ers, I propose to set up a po#er&oo! !ega &uster in I ha&karanji in Maharashtra #ith a Budget a&&o ation of ` D0 rore. Micro) Small and Medium Enterprises 71. In order to enhan e a$ai&abi&it" of e*uit" to M@M( se tor, I propose to set up a ` A,000 rore India 6pportunities Jenture Fund #ith @I/BI. 7&&o# (>B for &o# ost affordab&e housing proje ts= @et up >redit .uarantee 'rust Fund to ensure better f&o# of institutiona& redit for housing &oans= (nhan e pro$isions under Bura& ?ousing Fund fro! ` 3000 rore to ` 5000 rore= (,tend the s he!e of interest sub$ention of 1 per ent on housing &oan up to `1A &akh #here the ost of the house does not e, eed `2A &akh for another "ear= and (nhan e the &i!it ` A &akh to ` 10 &akh. of indire t finan e under priorit" se tor fro!

72. 'he @!a&& and Mediu! (nterprises 0@M(s1 are the bui&ding b&o ks of our e ono!". 'he" re&" pri!ari&" on &oans fro! banks and infor!a& sour es to raise apita&. 'o enab&e these enterprises greater a ess to finan e, t#o @M( e, hanges ha$e been &aun hed in Mu!bai re ent&". Public Procurement Policy for Micro and Small Enterprises 73. %ith the obje ti$e of pro!oting !arket a ess of Mi ro and @!a&& (nterprises, .o$ern!ent has appro$ed a po&i " #hi h re*uires Ministries and >P@(s to !ake a !ini!u! of 20 per ent of their annua& pur hases fro! M@(s. 6f this, 5 per ent #i&& be ear!arked for pro ure!ent fro! M@(s o#ned b" @>F@' entrepreneurs.

'.. /gr!cu+ture
I no# take up agri u&ture. 74. 7gri u&ture #i&& ontinue to be a priorit" for the .o$ern!ent. 'he tota& p&an out&a" for the /epart!ent of 7gri u&ture and >ooperation is being in reased b" 14 per ent fro! ` 1D,123 rore in 2011-12 to ` 20,204 rore in 2012-13. 75. 'he out&a" for Bashtri"a Irishi Jikas 8ojana 0BIJ81 is being in reased fro! `D,420 rore in 2011-12 to ` 3,21D rore in 2012-13. I a! happ" to infor! the ?ouse that the initiati$e of Bringing .reen Be$o&ution to (astern India 0B.B(I 0 has resu&ted in a signifi ant in rease in produ tion and produ ti$it" of padd". @tates in eastern India ha$e reported additiona& padd" produ tion of se$en !i&&ion tonnes in Iharif 2011. I propose to in rease the a&&o ation for this s he!e fro! `500 rore in 2011-12 to `1000 rore in 2012-13. 76. 'his "ear, under BIJ8, I a&so propose to a&&o ate `300 rore to Jidarbha Intensified Irrigation /e$e&op!ent Progra!!e. 'his @ he!e seeks to bring in !ore far!ing areas under prote ti$e irrigation. 77. 'he .o$ern!ent intends to !erge the re!aining a ti$ities into a set of !issions to address the needs of agri u&tura& de$e&op!ent in the '#e&fth Fi$e 8ear P&an. 'hese Missions are; 0i1 %ational Food Security Mission #hi h ai!s to bridge the "ie&d gap in respe t of padd", #heat, pu&ses, !i&&et and fodder. 'he ongoing Integrated /e$e&op!ent of Pu&ses Ji&&ages, Pro!otion of Cutri- erea&s and 7 e&erated Fodder /e$e&op!ent Progra!!e #ou&d no# be o!e a part of this Mission= %ational Mission on Sustainable Agriculture including Micro rrigation is being taken up as a part of the Cationa& 7 tion P&an on >&i!ate >hange. 'he Bainfed 7rea /e$e&op!ent Progra!!e #i&& be !erged #ith this=

0ii1

0iii1 %ational Mission on *ilseeds and *il Palm ai!s to in rease produ tion and produ ti$it" of oi& seeds and oi& pa&!= 0i$1 %ational Mission on Agricultural Extension and Tec(nology fo uses on adoption of appropriate te hno&ogies b" far!ers for i!pro$ing produ ti$it" and effi ien " in far! operations= and

0$1

%ational $orticulture Mission ai!s at horti u&ture di$ersifi ation. 'his #i&& a&so in &ude the initiati$e on saffron.

%ational Mission for Protein Supplement 78. Mission for Protein @upp&e!ent is being strengthened. 'o i!pro$e produ ti$it" in the dair" se tor, a `2,252 rore proje t is being &aun hed #ith %or&d Bank assistan e. 'o broaden the s ope of produ tion of fish to oasta& a*ua u&ture, apart fro! fresh #ater a*ua u&ture, the out&a" in 2012-13 is being stepped up to `A00 rore. @uitab&e a&&o ations are a&so being !ade for pou&tr", pigger" and goat rearing. Agriculture !redit 7&. Far!ers need ti!e&" a ess to affordab&e redit. I propose to raise the target for agri u&tura& redit in 2012-13 to `A,DA,000 rore. 'his represents an in rease of ` 1,00,000 rore o$er the target for the urrent "ear. 80. 'he interest sub$ention s he!e for pro$iding short ter! rop &oans to far!ers at D per ent interest per annu! #i&& be ontinued in 2012-13. 7n additiona& sub$ention of 3 per ent #i&& be a$ai&ab&e to pro!pt pa"ing far!ers. In addition, the sa!e interest sub$ention on post har$est &oans up to si, !onths against negotiab&e #arehouse re eipt #i&& a&so be a$ai&ab&e. 'his #i&& en ourage the far!ers to keep their produ e in #arehouses. 81. 7 @hort ter! BBB >redit Befinan e Fund is being set-up to enhan e the apa it" of Begiona& Bura& Banks to disburse short ter! rop &oans to the s!a&& and !argina& far!ers. I propose to a&&o ate ` 10,000 rore to C7B7B/ for refinan ing the BBBs through this fund. 82. Iisan >redit >ard 0I>>1 is an effe ti$e instru!ent for !aking agri u&tura& redit a$ai&ab&e to the far!ers. I>> s he!e #i&& be !odified to !ake I>> a s!art ard #hi h ou&d be used at 7'Ms. Agricultural Researc( 83. Food se urit" and agri u&tura& de$e&op!ent in the o!ing de ades #ou&d depend upon s ientifi and te hno&ogi a& breakthroughs in raising produ ti$it". %e ha$e to de$e&op p&ant and seed $arieties that "ie&d !ore and an resist &i!ate hange. I propose to set aside a su! of ` 200 rore for in enti$ising resear h #ith re#ards, both for institutions and the resear h tea! responsib&e for su h s ientifi breakthroughs. rrigation 84. Un&ess #e re ognise #ater as a resour e, the da" is not far #hen #ater stress #i&& start threatening our agri u&tura& produ tion. Fo us on !i ro irrigation s he!es to do$etai& these #ith #ater har$esting s he!es is ne essar". 'o !a,i!ise the f&o# of benefits fro! in$est!ents in irrigation proje ts, stru tura& hanges in 7 e&erated Irrigation Benefit Progra!!e 07IBP1 are being !ade. 'he a&&o ation for 7IBP in 2012-13 is being stepped up b" 13 per ent to `15,252 rore. 85. 'o !obi&ise &arge resour es to fund irrigation proje ts, a .o$ern!ent o#ned Irrigation and %ater Besour e Finan e >o!pan" is being operationa&ised. 'he >o!pan" #ou&d start its operations in 2012-13 b" fo using on finan ing sub-se tors &ike !i ro-irrigation, ontra t far!ing, #aste #ater !anage!ent and sanitation.

86. 7 f&ood !anage!ent proje t for Iandi sub-di$ision of Murshidabad /istri t has been appro$ed b" the .anga F&ood >ontro& >o!!ission at a ost of ` 533 rore, to be taken up for funding under the F&ood Manage!ent Progra!!e. %ational Mission on Food Processing 87. 'he food pro essing se tor has been gro#ing at an a$erage rate of o$er 4 per ent o$er the past A "ears. In order to ha$e a better outrea h and to pro$ide !ore f&e,ibi&it" to suit &o a& needs, it has been de ided that a ne# entra&&" sponsored s he!e tit&ed 9Cationa& Mission on Food Pro essing: #ou&d be started, in ooperation #ith the @tate .o$ern!ents in 2012-13. 88. 'he .o$ern!ent has taken steps to reate additiona& foodgrain storage apa it" in the ountr". >reation of 2 !i&&ion tonnes of storage apa it" in the for! of !odern si&os has a&read" been appro$ed. Cear&" 1A !i&&ion tonnes apa it" is being reated under the Pri$ate (ntrepreneur-s .uarantee @ he!e, of #hi h 3 !i&&ion tonnes of storage apa it" #i&& be added b" the end of 2011-12 and A !i&&ion #ou&d be added ne,t "ear.

.. '$c+u*!o$
Get !e no# take up proposa&s for in &usi$e de$e&op!ent. Schedu+ed ,a*te* a$d 1r!2a+ Su2 3+a$* 8&. Fro! the "ear 2011-12, a&&o ations are being !ade for @ hedu&ed >astes @ub P&an 0@>@P1 and 'riba& @ub P&an 0'@P1 under separate !inor heads as part of the P&an a&&o ations. In 2012-13, the a&&o ation for @>@P is `3D,113 rore #hi h represents an in rease of 14 per ent o$er 2011-12. 'he a&&o ation for '@P in 2012-13 is `21,D10 rore representing an in rease of 1D.2 per ent o$er 2011-12. )ood Secur!t% &0. 6ur .o$ern!ent has taken definite steps to reate food se urit" at the househo&d &e$e& b" !aking food a &ega& entit&e!ent for a&& targeted peop&e, espe ia&&" for the poor and $u&nerab&e seg!ents of our popu&ation. 'he Cationa& Food @e urit" Bi&&, 2011 is before the Par&ia!entar" @tanding >o!!ittee. &1. 'o ensure that the obje ti$es of the Cationa& Food @e urit" Bi&& are effe ti$e&" rea&ised, a Pub&i /istribution @"ste! Cet#ork is being reated using the 7adhaar p&atfor!. 7 Cationa& Infor!ation Uti&it" for the o!puterisation of P/@ is being reated. It #i&& be o!e operationa& b" /e e!ber 2012. Multi+sectoral %utrition Augmentation Programme &2. Fo&&o#ing the de ision taken in the Pri!e Minister-s Cationa& >oun i& on India-s Cutritiona& >ha&&enges, a !u&ti-se tora& progra!!e to address !aterna& and hi&d !a&nutrition in se&e ted 200 high burden distri ts is being ro&&ed out during 2012-13. It #i&& harness s"nergies a ross nutrition, sanitation, drinking #ater, pri!ar" hea&th are, #o!en edu ation, food se urit" and onsu!er prote tion s he!es.

&3. In this onte,t, Integrated >hi&d /e$e&op!ent @er$i es 0I>/@1 s he!e is being strengthened and re-stru tured. For 2012-13, an a&&o ation of `1A,4A0 rore has been !ade as against `10,000 rore in 2011-12. 'his a!ounts to an in rease of o$er A4 per ent. &4. Cationa& Progra!!e of Mid /a" Mea&s in @ hoo&s has enhan ed enro&!ent, retention, attendan e, and a&so he&ped in i!pro$ing nutrition &e$e&s a!ong hi&dren. In 2012-13, I propose to a&&o ate `11,33D rore for this s he!e as against `10,340 rore in 2011-12. &5. Baji$ .andhi @ he!e for (!po#er!ent of 7do&es ent .ir&s, @7BG7, has been introdu ed &ast "ear #ith a $ie# to address the nutritiona& needs and other edu ationa& and ski&& de$e&op!ent initiati$es for se&f de$e&op!ent of ado&es ent gir&s in the age group of 11 to 14 "ears. For 2012-13, an a&&o ation of `DA0 rore has been proposed for the s he!e. 4ura+ -e e+opme$t a$d 3a$cha%at! 4a5 &6. 7&ong #ith #ater *ua&it", poor sanitation is one of the fa tors ontributing to !a&nourish!ent. ?on-b&e Me!bers #i&& be happ" to kno# that I propose to in rease the budgetar" a&&o ation for rura& drinking #ater and sanitation fro! `11,000 rore in 2011-12 to `15,000 rore in 2012-13. 'his is an in rease of o$er 2D per ent. &7. Pradhan Mantri .ra! @adak 8ojana 0PM.@81 has been a su essfu& progra!!e. In 2012-13, I propose to raise the a&&o ation b" 20 per ent to this s he!e b" pro$iding `25,000 rore. It #i&& a e&erate onne ti$it" in the @tates. &8. 7 !ajor initiati$e has been proposed to strengthen Pan ha"ats a ross the ountr" through the Baji$ .andhi Pan ha"at @ashaktikaran 7bhi"an 0B.P@71. 'his progra!!e #i&& e,pand on the e,isting s he!es for Pan ha"at apa it" bui&ding. &&. In !" Budget @pee h &ast "ear, I had referred to our fo us on the de$e&op!ent of ba k#ard regions. %e ha$e de ided to arr" the Ba k#ard Begions .rant Fund s he!e into the '#e&fth P&an #ith an enhan ed a&&o ation of `12,050 rore in 2012-13, an in rease of about 22 per ent o$er B( of 2011-12. 'his in &udes the @tate o!ponent #hi h o$ers proje ts in ba k#ard areas in Bihar, %est Benga& and the Ia&ahandi-Bo&angir-Ioraput region of 6disha, de$e&op!ent proje ts for drought !itigation in the Bunde&khand region and proje ts under the Integrated 7 tion P&an to a e&erate the pa e of de$e&op!ent in se&e ted triba& and ba k#ard distri ts. Rural nfrastructure Development Fund 100. 'his "ear, I propose to enhan e the a&&o ation under Bura& Infrastru ture /e$e&op!ent Fund 0BI/F1 to ` 20,000 rore. Further in $ie# of the #arehousing shortage in the ountr", I propose to ear!ark an a!ount of ` A,000 rore fro! the abo$e a&&o ation e, &usi$e&" for reating #arehousing fa i&ities under BI/F. Education 101. 'he Bight to (du ation 0B'(1 7 t is being i!p&e!ented #ith effe t fro! 7pri& 1, 2010 through the @ar$a @hiksha 7bhi"an 0@@71. For 2012-13, I ha$e pro$ided `2A,AAA rore for B'(-@@7. 'his is an in rease of 21.D per ent o$er 2011-12.

102. In the '#e&fth P&an, 2,000 s hoo&s ha$e been proposed to be set up at b&o k &e$e& as !ode& s hoo&s to ben h!ark e, e&&en e. 6f these, 2A00 #i&& be set up under Pub&i Pri$ate Partnership. 103. 'he Bashtri"a Madh"a!ik @hiksha 7bhi"an 0BM@71 #as &aun hed in Mar h, 2003 to enhan e a ess to *ua&it" se ondar" edu ation. In 2012-13, I ha$e a&&o ated `3,125 rore for BM@7 #hi h is near&" 23 per ent higher than the a&&o ation in 2011-12. 104. 7 s he!e for edu ation &oans is being i!p&e!ented b" banks. 'o ensure better f&o# of redit to deser$ing students, I propose to set up a >redit .uarantee Fund for this purpose. 6ea+th 105. 'he" sa" persisten e pa"s. I a! happ" to infor! ?on-b&e Me!bers that no ne# ase of po&io #as reported in the &ast one "ear. B" !odernising e,isting units and setting up a ne# integrated $a ine unit near >hennai, the .o$ern!ent #i&& a hie$e $a ine se urit" and keep the pressure on disease eradi ation and pre$ention. 106. Cationa& Bura& ?ea&th Mission 0CB?M1 is being i!p&e!ented through N7 redited @o ia& ?ea&th 7 ti$ist-- N7@?7-. 'he s ope of 7@?7-s a ti$ities is being en&arged to in &ude pre$ention of Iodine /efi ien " /isorders, ensure 100 per ent i!!unisation and better spa ing of hi&dren. 7t the o!!unit" &e$e&, a !ore a ti$e ro&e is en$isaged for 7@?7 as the on$enor of the Ji&&age ?ea&th and @anitation >o!!ittee, as a&so to support the initiati$e on !a&nutrition. @in e 7@?7s re ei$e a ti$it"-#ise, perfor!an e-based pa"!ents, this #i&& a&so enhan e their re!uneration. I propose to in rease the a&&o ation to CB?M fro! `14,11A rore in 2011-12 to `20,422 rore in 2012-13. 107. Cationa& Urban ?ea&th Mission is being &aun hed to en o!pass the pri!ar" hea&th are needs of peop&e in the urban areas. 'he Pradhan Mantri @#asth"a @uraksha 8ojana 0PM@@81 ai!ed at setting up of 7IIM@-&ike institutions and upgradation of e,isting .o$ern!ent !edi a& o&&eges is being e,panded to o$er upgradation of D !ore .o$ern!ent !edi a& o&&eges. It #i&& enhan e the a$ai&abi&it" of affordab&e tertiar" hea&th are. #mp+o%me$t a$d Sk!++ -e e+opme$t 108. 'he Mahat!a .andhi Cationa& Bura& (!p&o"!ent .uarantee @ he!e 0M.CB(.@1 has had a positi$e i!pa t on &i$e&ihood se urit". For the first ti!e, there is an effe ti$e f&oor #age rate for rura& #orkers. /istress !igration has o!e do#n. >o!!unit" assets ha$e been reated. Produ ti$it" of barren and fa&&o# &ands has gone up. 'he need for i!pro$ing *ua&it" of assets and bringing about greater s"nerg" bet#een M.-CB(.7 and agri u&ture and a&&ied rura& &i$e&ihoods is being addressed. 10&. 'he @#arnja"anti .ra! @#aro)gar 8ojana 0@.@81 has been restru tured into Cationa& Bura& Gi$e&ihood Mission 0CBGM1 to pro$ide se&f-e!p&o"!ent opportunities. 7 subo!ponent, Mahi&a Iisan @ashaktikaran Pari"ojana, under CBGM seeks to pro$ide better

targeting of #o!en far!ers. For CBGM, I propose to in rease the a&&o ation b" o$er 35 per ent fro! `2,315 rore in 2011-12 to `3,31A rore in 2012-13. 110. In &ast "ear-s Budget I had announ ed reation of a N%o!en-s @?.-s /e$e&op!ent Fund-. 'his has been set up in C7B7B/. In 2012-13, I propose to pro$ide ` 200 rore to en&arge the orpus to ` 300 rore. 'his Fund #i&& a&so support the obje ti$es of 7ajee$ika i.e. the Cationa& Bura& Gi$e&ihood Mission. It #i&& e!po#er #o!en @?.s to a ess bank redit. I propose to pro$ide interest sub$ention to %o!en @?.s to a$ai& &oans up to `3 &akh at D per ent per annu!. %o!en @?.s that repa" &oans in ti!e #i&& get additiona& 3 per ent sub$ention, redu ing the effe ti$e rate to 5 per ent. 'he initiati$e, in the first phase, #ou&d fo us on se&e ted 200 B&o ks of 1A0 distri ts, in &uding the Geft %ing (,tre!is! affe ted distri ts. 111. It is proposed to estab&ish a Bharat Gi$e&ihoods Foundation of India through 7ajee$ika. 'he Foundation #ou&d support and s a&e up i$i& so iet" initiati$es and inter$entions parti u&ar&" in the triba& regions o$ering around 1D0 distri ts. Pri$ate trusts and phi&anthropi organisations #ou&d be en ouraged to partner #ith the autono!ous bod" that #i&& be !anaged professiona&&". 112. 'o en ourage !i ro enterprises, a redit &inked subsid" progra!!e na!e&" Pri!e Minister-s (!p&o"!ent .eneration Progra!!e 0PM(.P1 is being i!p&e!ented through IJI>. 'he a&&o ation for this progra!!e has been in reased b" 23 per ent fro! `1,03D rore in 201112 to `1,2D2 rore in 2012-13. S"ill Development 113. In 2011-12 Cationa& @ki&& /e$e&op!ent >orporation 0C@/>1 appro$ed 22 ne# proje ts, thereb" doub&ing the nu!ber of proje ts san tioned sin e 2003 to A2, #ith a tota& funding o!!it!ent of ` 1,20A rore. 7t the end of 10 "ears, these proje ts are e,pe ted to train 2.2 rore persons and aug!ent $o ationa& training apa it" b" 1.2A rore per "ear in the pri$ate se tor. 114. 'he C@/> partners ha$e opened 532 per!anent and 2523 !obi&e entres in 220 distri ts a ross 25 states. More than 43,A00 persons ha$e been trained and a&!ost 40 per ent e!p&o"ed. Under C@/>, 10 @e tor @ki&& >oun i&s ha$e been san tioned. 6f these, 3 @ki&& >oun i&s for 7uto!obi&e, @e urit" and Betai& se tors ha$e be o!e operationa&. For 2012-13, I propose to a&&o ate ` 1000 rore to Cationa& @ki&& /e$e&op!ent Fund 0C@/F1. 115. In order to i!pro$e the f&o# of institutiona& redit for ski&& de$e&op!ent, I propose to set up separate >redit .uarantee Fund. 'his #i&& benefit "outh in a *uiring !arket oriented ski&&s. 116. 7 ne# s he!e tit&ed 9?i!a"at: #as introdu ed in +a!!u and Iash!ir fro! 2011-12. It ai!s to pro$ide ski&& training to one &akh "outh in the ne,t fi$e "ears. 'he entire ost of this progra!!e is being borne b" the >entre. Soc!a+ *ecur!t% a$d the $eed* of "eaker *ect!o$* 117. I a! raising the a&&o ation under the Cationa& @o ia& 7ssistan e Progra!!e 0C@7P1 b" 3D per ent fro! ` 2,1A4 rore in 2011-12 to ` 4,55D rore in 2012-13. Under the ongoing Indira

.andhi Cationa& %ido# Pension @ he!e and Indira .andhi Cationa& /isabi&it" Pension @ he!e for BPG benefi iaries, the !onth&" pension a!ount per person is being raised fro! ` 200 to ` 300. 118. 6n the death of the pri!ar" bread#inner of a BPG fa!i&", in the age group 14 to 25 "ears, a &u!psu! grant of `10,000 is present&" pro$ided under the Cationa& Fa!i&" Benefit s he!e. I propose to doub&e this a!ount to ` 20,000 and e,pe t a !at hing ontribution b" the @tate .o$ern!ents. 11&. In order to pro!ote $o&untar" sa$ings to#ards pensions, a o- ontributor" s he!e @%7J7G7MB7C #as started in @epte!ber, 2010. 6$er A &akh subs ribers ha$e been enro&&ed b" Februar" 2012. In order to enhan e a ess to this s he!e, GI> has been appointed as an 7ggregator and a&& Pub&i @e tor Banks ha$e a&so been appointed as Points of Presen e 0PoP1 and 7ggregators. nstitutions t(at are being given grants 120. 'he dri$ing for e of a !odern nation is resear h and the reation of ne# kno#&edge. %ith this in !ind I propose to pro$ide; < < < < < < < < < < Secur!t% 121. In the Budget for 2012-13, a pro$ision of ` 1,33,50D rore has been !ade for /efen e @er$i es #hi h in &ude `D3,AD3 rore for apita& e,penditure. 7s a&#a"s, this a&&o ation is based on present needs and an" further re*uire!ent #ou&d be !et. 122. .o$ern!ent is !aking efforts to in rease the a$ai&abi&it" of residentia& *uarters to for es. In 2012-13, it is en$isaged to onstru t near&" 5,000 residentia& *uarters for >entra& 7r!ed Po&i e For es for #hi h ` 1,14A rore is proposed to be a&&o ated. 7 pro$ision of ` 3,240 rore for 2012-13 has a&so been !ade for onstru tion of offi e bui&dings in &uding &and a *uisition and barra ks to a o!!odate 2D,000 personne&. 123. 'he s he!e to reate the Cationa& Popu&ation Begister 0CPB1 is progressing #e&&. It is &ike&" to be o!p&eted #ithin the ne,t t#o "ears. 'he .o$ern!ent is a&so onsidering a proposa&
` 2A rore to the Institute of Bura& Manage!ent, 7nand= ` A0 rore to estab&ish a #or&d- &ass entre for #ater *ua&it" #ith fo us on arseni

onta!ination in Io&kata= ` 100 rore to Iera&a 7gri u&tura& Uni$ersit"= ` A0 rore for Uni$ersit" of 7gri u&tura& @ ien es /har#ad, Iarnataka= ` A0 rore to >haudhar" >haran @ingh ?ar"ana 7gri u&tura& Uni$ersit", ?issar= ` A0 rore to 6rissa Uni$ersit" of 7gri u&ture and 'e hno&og"= ` 100 rore to 7 har"a C. .. Banga 7gri u&tura& Uni$ersit" in ?"derabad= ` 1A rore to Cationa& >oun i& for 7pp&ied ( ono!i Besear h= ` 10 rore to Baji$ .andhi Uni$ersit", /epart!ent of ( ono!i s, Itanagar= and ` 10 rore to @iddharth Jihar 'rust .u&barga, to estab&ish a Pa&i &anguage Besear h >entre.

of issuing Besident Identit" >ards bearing the 7adhaar nu!bers to a&& residents #ho are of age 14 "ears and abo$e to he&p in the e-go$ernan e initiati$es.

.'. (o er$a$ce
I no# address so!e on erns in go$ernan e. , D+Aad(aar 124. 'he enro&!ents into the 7adhaar s"ste! ha$e rossed 20 rore and the 7adhaar nu!bers generated upto date ha$e rossed 15 rore. I propose to a&&o ate ade*uate funds to o!p&ete another 50 rore enro&!ents starting fro! 7pri& 1, 2012. 'he 7adhaar p&atfor! is no# read" to support the pa"!ents of M.-CB(.7= o&d age, #ido# and disabi&it" pensions= and s ho&arships dire t&" to the benefi iar" a ounts in se&e ted areas. Blac" Money 125. Gast "ear I had out&ined a fi$e pronged strateg" to ta k&e the !a&aise of generation and ir u&ation of b&a k !one" and its i&&egiti!ate transfer outside India. .o$ern!ent has taken a nu!ber of proa ti$e steps to i!p&e!ent this strateg". 7s a resu&t; < 42 /oub&e 'a,ation 7$oidan e 7gree!ents 0/'771 and 1D 'a, Infor!ation (, hange 7gree!ents 0'I(71 ha$e been fina&ised and infor!ation regarding bank a ounts and assets he&d b" Indians abroad has started f&o#ing in. In so!e ases prose ution #i&& be initiated= /edi ated e, hange of infor!ation e&& for speed" e, hange of ta, infor!ation #ith treat" ountries is fu&&" fun tiona& in >B/'= India be a!e the 33rd signator" of the Mu&ti&atera& >on$ention on Mutua& 7d!inistrati$e 7ssistan e in 'a, Matters= and /ire torate of In o!e 'a, >ri!ina& In$estigation has been estab&ished in >B/'.

< < <

126. I propose to &a" on the tab&e of the ?ouse a #hite paper on B&a k Mone" in the urrent session of Par&ia!ent. Public Procurement #egislation 127. .o$ern!ent is o!!itted to the ena t!ent of a Pub&i Pro ure!ent &egis&ation to enhan e onfiden e in pub&i pro ure!ent and to ensure transparen " and effi ien " in the pro ess. 'he Bi&& in this regard is to be introdu ed in the Budget session of the Par&ia!ent. 128. 'he fo&&o#ing &egis&ati$e !easures for strengthening anti- orruption fra!e#ork are in $arious stages of ena t!ent; < Pre$ention of Mone" Gaundering 07!end!ent1 Bi&&, 2011 introdu ed in Par&ia!ent #ith a $ie# to bring ertain pro$isions of the 7 t in &ine #ith g&oba& standards=

<

Bena!i 'ransa tions 0Prohibition1 Bi&&, 2011 is urrent&" being e,a!ined b" the @tanding >o!!ittee on Finan e. It #ou&d rep&a e the NBena!i 'ransa tions 0Prohibition1 7 t, 1344-= and Cationa& /rugs and Ps" hotropi @ubstan es 07!end!ent1 Bi&&, 2011 introdu ed in Par&ia!ent #ith a $ie# to strengthen &ega& pro$isions for i!p&e!entation of the nationa& po&i " on Car oti /rugs and Ps" hotropi @ubstan es.

<

.''. Budget #*t!mate* 2012-13

I no# turn to the Budget (sti!ates for 2012-13. 12&. 'he .ross 'a, Be eipts are esti!ated at ` 10,DD,212 rore #hi h is an in rease of 1A.2 per ent o$er the Budget (sti!ates and 13.A per ent o$er the Be$ised (sti!ates for 2011-12. 7s a per entage of ./P, gross ta,es are esti!ated at 10.2 per ent in B( 2012-13 as against 10.5 per ent in B( 2011-12. 7fter de$o&ution to @tates, the net ta, to >entre in 2012-13 is esti!ated at ` D,D1,0D1 rore. 'he Con 'a, Be$enue Be eipts for 2012-13 are esti!ated at ` 1,25,215 rore and Con-debt >apita& Be eipts at ` 51,2A0 rore. 'he te!porar" arrange!ent to use disin$est!ent pro eeds for apita& e,penditure in so ia& se tor s he!es is being e,tended for one !ore "ear to 2012-13. 130. 'he tota& e,penditure for 2012-13 is budgeted at ` 15,30,32A rore. 6f this, the P&an (,penditure for 2012-13 is ` A,21,02A rore, #hi h is 14 per ent higher than the Budget (sti!ates of 2011-12. 'his is higher than the 1A per ent in rease proje ted in the 7pproa h to the '#e&fth P&an for 2012-13. I a! happ" to infor! the ?on-b&e Me!bers that in the (&e$enth P&an, #e ha$e been ab&e to !eet 33 per ent of the tota& p&an out&a". 131. 'he Con P&an (,penditure for 2012-13 is budgeted at ` 3,23,300 rore #hi h is 4.D per ent higher than the Be$ised (sti!ates for 2011-12 and 14.4 per ent higher than the Budget (sti!ates for 2011-12. 'his in rease is !ain&" on a ount of higher pro$ision for !ajor subsidies. %hi&e !aking ade*uate pro$isions for funding the desirab&e subsidies, as indi ated ear&ier, I a! deter!ined to ontain the in reasing subsid" burden through !easures in &uding i!pro$ed targeting. 132. 'he P&an and Con P&an resour es transferred to @tates and Union 'erritories in &uding dire t transfers to @tate and distri t &e$e& i!p&e!enting agen ies are ` 3,2A,212 rore in B( 2012-13. 'his in &udes ` 14,2AA rore of grant to &o a& bodies as per the re o!!endations of 'hirteenth Finan e >o!!ission. 133. 'he "ear 2011-12 #as one of ha&&enges for fis a& !anage!ent. /ue to the s&o#er e ono!i gro#th, dire t ta, o&&e tion fe&& short b" ` 32,000 rore of the Budget (sti!ates. 7t the sa!e ti!e, the .o$ern!ent absorbed dut" redu tion in petro&eu! se tor #ith annua& re$enue &oss of ` 53,000 rore. 'he .o$ern!ent had to in ur higher e,penditure on petro&eu! and ferti&iser subsid" to insu&ate the peop&e fro! the rising pri es. %hi&e the outgo on a ount of subsidies in reased, I ha$e ensured that the entire a!ount is gi$en in ash and not as bonds in &ieu of subsidies. 'his is in &ine #ith the approa h that I out&ined in !" Budget @pee h for 201011.

134. 'he o!bined effe t of &o#er ta, and disin$est!ent re eipts and higher e,penditure, !ain&" on a ount of subsidies, has pushed the fis a& defi it to A.3 per ent of ./P in the Be$ised (sti!ates for 2011-12. ?o#e$er, I ha$e !ade a deter!ined atte!pt to o!e ba k to the path of fis a& onso&idation in the Budget for 2012-13 b" pegging the fis a& defi it at ` A,13,A30 rore #hi h is A.1 per ent of ./P. 7fter taking into a ount other ite!s of finan ing, the net !arket borro#ings through dated se urities to finan e this defi it is ` 5.D3 &akh rore. %ith this, the tota& /ebt sto k at the end of 2012-13 #ou&d #ork out at 5A.A per ent of ./P as o!pared to the 'hirteenth Finan e >o!!ission target of A0.A per ent of ./P. 'he (ffe ti$e Be$enue /efi it in B( 2012-13 #orks out to ` 1,4A,DA2 rore #hi h is 1.4 per ent of ./P.

3art B

.'''. 1a7 3ropo*a+*

Madam Speaker, I no# o!e to Part B of !" proposa&s. 135. 'he &ife of a Finan e Minister is not eas". Jarious p&a"ers, in &uding po&i " !akers, po&iti ians, agri u&turists and business houses, parti ipate in the !aking of the e ono!". %hen e$er"thing goes #e&& #ith the e ono!", #e a&& share in the jo". ?o#e$er, #hen things go #rong, it is the Finan e Minister #ho is a&&ed upon to ad!inister the !edi ine. ( ono!i po&i ", as in !edi a& treat!ent, often re*uires us to do so!ething, #hi h, in the short run, !a" be painfu&, but is good for us in the &ong run. 7s ?a!&et, the Prin e of /en!ark, had said in @hakespeare-s i!!orta& #ords, 9I !ust be rue& on&" to be kind.: %ith this re!inder, &et !e no# turn to the ta, proposa&s. 136. Gast "ear, I had set the o!pass for !o$e!ent to#ards the /'> in /ire t 'a,es and .@' in Indire t 'a,es. M" ta, proposa&s for fis a& "ear 2012-13 !ark further progress in that dire tion. -!rect 1a7e* I sha&& no# dea& #ith dire t ta,es. 137. Gast "ear I pro$ided re&ief to indi$idua& ta,pa"ers b" enhan ing the e,e!ption &i!it as a !o$e to#ards /'> rates. 7&though /'> #i&& not be effe ti$e fro! this "ear, I propose to introdu e the /'> rates for persona& in o!e ta,. I propose to enhan e the e,e!ption &i!it for the genera& ategor" of indi$idua& ta,pa"ers fro! `1,40,000 to `2,00,000. 'his !easure #i&& pro$ide ta, re&ief upto `2,000 to e$er" ta,pa"er of this ategor". I a&so propose to raise the upper &i!it of the 20 per ent ta, s&ab fro! `4 &akh to `10 &akh. 'he proposed persona& in o!e ta, s&abs are; In o!e upto `2 &akh In o!e abo$e `2 &akh and upto `A &akh In o!e abo$e `A &akh and upto `10 &akh Ci& 10 per ent 20 per ent

In o!e abo$e `10 &akh

30 per ent

'hese hanges #i&& pro$ide substantia& re&ief to ta,pa"ers. 138. I propose to a&&o# indi$idua& ta,pa"ers, a dedu tion of upto `10,000 for interest fro! sa$ings bank a ounts. 'his #ou&d he&p a &arge nu!ber of s!a&& ta,pa"ers #ith sa&ar" in o!es upto `A &akh and interest fro! sa$ings bank a ounts up to ` 10,000, as the" #ou&d not be re*uired to fi&e in o!e ta, returns. 13&. %ithin the e,isting &i!it for dedu tion a&&o#ed for hea&th I propose to a&&o# a dedu tion of upto `A,000 for pre$enti$e hea&th he k-up. insuran e,

140. @enior iti)ens #ho do not ha$e an" in o!e fro! business are proposed to be e,e!pted fro! the pa"!ent of ad$an e ta,. 'his #i&& redu e their o!p&ian e burden. 141. In the ase of orporates, I a! not proposing an" hange in the ta, rates. ?o#e$er, I propose ertain !easures to a&&o# orporates to a ess &o#er ost funds and to pro!ote higher &e$e& of in$est!ents in se$era& se tors. 142. In order to pro$ide &o# ost funds to so!e stressed infrastru ture se tors, the rate of #ithho&ding ta, on interest pa"!ents on e,terna& o!!er ia& borro#ings is proposed to be redu ed fro! 20 per ent to A per ent for three "ears. 'hese se tors are; < < < < < < < po#er= air&ines= roads and bridges= ports and ship"ards= affordab&e housing= ferti&i)er= and da!s

143. 'he restri tion on Jenture >apita& Funds to in$est on&" in nine spe ified se tors is proposed to be re!o$ed. It is further proposed to re!o$e the as ading effe t of /i$idend /istribution 'a, 0//'1 in a !u&ti-tier orporate stru ture. I a&so propose to ontinue to a&&o# repatriation of di$idends fro! foreign subsidiaries of Indian o!panies to India at a &o#er ta, rate of 1A per ent as against the ta, rate of 30 per ent for one !ore "ear i.e. upto Mar h 31, 2013. 144. In$est!ent &inked dedu tion of apita& e,penditure in urred in the fo&&o#ing businesses is proposed to be pro$ided at the enhan ed rate of 1A0 per ent, as against the urrent rate of 100 per ent. < < < < < >o&d hain fa i&it" %arehouses for storage of food grains ?ospita&s Ferti&isers 7ffordab&e housing

145. 'he fo&&o#ing ne# se tors are proposed to be added for the purposes of in$est!ent &inked dedu tion; < < < bee keeping and produ tion of hone" and bees#a, ontainer freight station and in&and ontainer depots #arehousing for storage of sugar

146. 'o pro!ote in$est!ent in resear h and de$e&op!ent, it is proposed to e,tend the #eighted dedu tion of 200 per ent for BM/ e,penditure in an in-house fa i&it" be"ond Mar h 31, 2012 for a further period of fi$e "ears. 147. I a&so propose to pro$ide #eighted dedu tion of 1A0 per ent on e,penditure in urred for agri-e,tension ser$i es in order to fa i&itate gro#th in the agri u&ture se tor. 148. For the po#er se tor, besides a ess to &o# ost funds as out&ined abo$e, I a&so propose e,tension of the sunset date b" one "ear for po#er se tor undertakings so that the" an be set up on or before Mar h 31, 2013 for &ai!ing 100 per ent dedu tion of profits for 10 "ears. 7dditiona& depre iation of 20 per ent in the initia& "ear is proposed to be e,tended to ne# assets a *uired b" po#er generation o!panies. 14&. For @M(s, the turno$er &i!it for o!pu&sor" ta, audit of a ounts as #e&& as for presu!pti$e ta,ation is proposed to be raised fro! `20 &akh to ` 1 rore. 150. In order to aug!ent funds for @M(s, I propose to e,e!pt apita& gains ta, on sa&e of a residentia& propert", if the sa&e onsideration is used for subs ription in e*uit" of a !anufa turing @M( o!pan" for pur hase of ne# p&ant and !a hiner". 151. >onsidering the shortage of ski&&ed !anpo#er in the !anufa turing se tor and to generate e!p&o"!ent, I propose to pro$ide #eighted dedu tion at the rate of 1A0 per ent of e,penditure in urred on ski&& de$e&op!ent in !anufa turing se tor in a ordan e #ith spe ified guide&ines. 152. In order to redu e transa tion osts in the apita& !arkets, I propose redu tion in @e urities 'ransa tion 'a, 0@''1 b" 20 per ent 0fro! 0.12A per ent to 0.1 per ent1 on ash de&i$er" transa tions. 153. In order to !oderate the outgo on profit &inked dedu tions, I propose to e,tend the &e$" of 7&ternate Mini!u! 'a, 07M'1 on a&& persons other than o!panies, &ai!ing profit &inked dedu tions. 154. I propose to introdu e a .enera& 7nti 7$oidan e Bu&e 0.77B1 in order to ounter aggressi$e ta, a$oidan e s he!es, #hi&e ensuring that it is used on&" in appropriate ases, b" enab&ing a re$ie# b" a .77B pane&. 155. I propose a series of !easures to deter the generation and use of una ounted !one". 'o this end, I propose < Introdu tion of o!pu&sor" reporting re*uire!ent in ase of assets he&d abroad.

< < < < < <

7&&o#ing for reopening of assess!ent upto 12 "ears in re&ation to assets he&d abroad. 'a, o&&e tion at sour e on pur hase in ash of bu&&ion or je#e&&er" in e, ess of ` 2 &akh. 'a, dedu tion at sour e on transfer of i!!o$ab&e propert" 0other than agri u&tura& &and1 abo$e a spe ified thresho&d. 'a, o&&e tion at sour e on trading in oa&, &ignite and iron ore. In reasing the onus of proof on &ose&" he&d o!panies for funds re ei$ed fro! shareho&ders as #e&& as ta,ing share pre!iu! in e, ess of fair !arket $a&ue. 'a,ation of une,p&ained !one", redits, in$est!ents, e,penditures et ., at the highest rate of 30 per ent irrespe ti$e of the s&ab of in o!e.

156. M" proposa&s on /ire t 'a,es are esti!ated to resu&t in a net re$enue &oss of ` 5A00 rore for the "ear. '$d!rect 1a7e* 157. I sha&& no# turn to indire t ta,es. In a s&ight departure fro! the pre$ious "ears, I sha&& begin #ith @er$i e 'a,. Ser !ce 1a7 158. 7t the end of +une this "ear, this ta, #i&& attain adu&thood b" o!p&eting 14 "ears. It is therefore ti!e to shift gears and a e&erate ahead. ?o#e$er, ser$i e ta, needs to onfront t#o i!portant ha&&enges to sustain the journe". 'hese are; < < 'he share of ser$i es in ta,es re!ains far be&o# its potentia&. 'here is a need to #iden the ta, base and strengthen its enfor e!ent= @er$i e 'a, &a# is o!p&e, and so!eti!es a$oidab&" different fro! >entra& (, ise. %e need to bring the t#o as &ose as possib&e in the &ight of our e$entua& goa& of transition to .@'.

I ha$e atte!pted to address both these issues this "ear. 15&. Gast "ear, I had initiated a pub&i debate on the desirabi&it" of !o$ing to#ards ta,ation of ser$i es based on a negati$e &ist. In the debate that ontinued for the better part of the "ear, #e re ei$ed o$er#he&!ing support for this ne# on ept. It has been per ei$ed both as sound e ono!i s and prudent fis a& !anage!ent. 160. 'hus, I propose to ta, a&& ser$i es e, ept those in the negati$e &ist. 'he &ist o!prises 1D heads and has been arefu&&" dra#n up, keeping in $ie# the federa& nature of our po&it", the best internationa& pra ti es and our so io-e ono!i re*uire!ents. 161. 'he i!portant in &usions in the negati$e &ist o!prise a&& ser$i es pro$ided b" the go$ern!ent or &o a& authorities, e, ept a fe# spe ified ser$i es #here the" o!pete #ith pri$ate se tor. 'he &ist a&so in &udes pre-s hoo& and s hoo& edu ation, re ognised edu ation at higher

&e$e&s and appro$ed $o ationa& edu ation, renting of residentia& d#e&&ings, entertain!ent and a!use!ent ser$i es and a &arge part of pub&i transportation in &uding in&and #ater#a"s, urban rai&#a"s and !etered abs. 162. 7gri u&ture and ani!a& husbandr" enjo" a $er" i!portant p&a e in our &i$es. Pra ti a&&" a&& ser$i es re*uired for u&ti$ation, breeding, produ tion, pro essing or !arketing up to the stage the produ e is so&d in the pri!ar" !arkets are o$ered b" the &ist. 163. In addition to the negati$e &ist, there is a &ist of e,e!ptions #hi h in &ude hea&th are, ser$i es pro$ided b" harities, re&igious persons, sportspersons, perfor!ing artists in fo&k and &assi a& arts, indi$idua& ad$o ates pro$iding ser$i es to non-business entities, independent journa&ists, and ser$i es b" #a" of ani!a& are or ar parking. 164. 'o take finan ia& ser$i es to the door steps in rura& areas, I ha$e a&so e,e!pted the ser$i es of business fa i&itators and orrespondents to banks and insuran e o!panies. 165. >onstru tion ser$i es re&ating to spe ified infrastru ture, ana&s, irrigation #orks, posthar$est infrastru ture, residentia& d#e&&ing, and &o#- ost !ass housing up to an area of 20 s*. !tr. under the @ he!e of 7ffordab&e ?ousing in Partnership are a&so in &uded in the e,e!ptions. 'o !ake the &ife of those #ho a&read" o#n an apart!ent a &itt&e easier, I propose to raise the e,e!ption for the !onth&" harges pa"ab&e b" a !e!ber to a housing so iet" fro! ` 3,000 to `A,000. 166. 'he 8ear 2012 !arks the beginning of the entenar" "ear of Indian ine!a. /espite the hange in tit&es fro! /ada @aheb Pha&ke-s 9Baja ?arish handra: to 9Ba. 6ne: in re ent ti!es, the industr" has p&a"ed a pi$ota& ro&e in unif"ing our ountr" in the #ake of her onsiderab&e di$ersit". 'o add to their spirit of e&ebration, I propose to e,e!pt the industr" fro! ser$i e ta, on op"rights re&ating to re ording of ine!atographi fi&!s. 167. Mo$e!ent to#ards the negati$e &ist #i&& resu&t in redu ing near&" 230 definitions and des riptions in the 7 t to A5, and the e,e!ptions fro! the e,isting 44 to 10, of ourse !erging so!e of the e,isting e,e!ptions into a re$ised notifi ation. In ter!s of nu!ber of pages, the &a# #i&& be shorter b" near&" 50 per ent. 168. 7s a !easure of har!onisation bet#een >entra& (, ise and @er$i e 'a,, a nu!ber of a&ign!ents ha$e been !ade. 'hese in &ude a o!!on si!p&ified registration for! and a o!!on return for >entra& (, ise and @er$i e 'a,, to be na!ed (@'-1. 'his o!!on return #i&& o!prise on&" one page, #hi h #i&& be a signifi ant redu tion fro! the 1A pages of the t#o returns at present. 16&. Be$ision 7pp&i ation 7uthorit" and @ett&e!ent >o!!ission are being introdu ed in @er$i e 'a, to he&p reso&$e disputes #ith far greater ease. 170. >as ading of ta,es has been signifi ant&" redu ed b" per!itting uti&isation of input ta, redits in a nu!ber of ser$i es su h as atering, restaurants, hote& a o!!odation, panda& and sha!iana and transport se tors. 171. P&a e of @upp&" Bu&es, that #i&& deter!ine the &o ation #here a ser$i e sha&& be dee!ed to be pro$ided, are being p&a ed in pub&i do!ain for stakeho&ders- o!!ents and sha&& be notified #hen the negati$e &ist is put into effe t. 'hese ru&es #i&& a&so pro$ide a possib&e

ba kdrop to initiate an infor!ed debate to assess a&& the issues that !a" arise in the ta,ation of inter-state ser$i es for the e$entua& &aun h of .@'. 172. I propose to set up a @tud" 'ea! to e,a!ine the possibi&it" of a o!!on ta, ode for ser$i e ta, and entra& e, ise #hi h ou&d be adopted to har!onise the t#o &egis&ations as !u h as possib&e at the right ti!e. 173. %hi&e the prob&e!s fa ed b" e,porters of goods #ith respe t to ta,es on input ser$i es #as addressed ear&ier this "ear, disburse!ent of ta,es that go into the e,port of ser$i es has been an irritant for &ong. I no# announ e a ne# s he!e that #i&& si!p&if" refunds #ithout resorting to $o&u!inous do u!entation or $erifi ation. 7s an added in enti$e, su h refunds #i&& a&so be ad!issib&e for ta,es on ta,ab&e ser$i es that ha$e been e,e!pted. 174. Bu&es pertaining to the Point of 'a,ation are a&so being rationa&ised, pro$iding greater &arit" and re!o$ing the irritants. >en$at redits in a nu!ber of areas are being restored. 'here are a nu!ber of other proposa&s both for the fa i&itation of business and to he k !a&pra ti es. I do not #ish to take the $a&uab&e ti!e of this ?ouse for dis ussing a&& these proposa&s. 175. 8ou #i&& noti e that !ost of these !easures are guided b" the need to !o$e to#ards a s"ste! that is si!p&e, e*uitab&e and progressi$e but are un&ike&" to !ake the e, he*uer ri her in an" signifi ant #a". Gooking at our $ast o!!it!ents and to !aintain a hea&th" fis a& situation, I propose to raise the ser$i e ta, rate fro! 10 per ent to 12 per ent, #ith onse*uentia& hanges in rates for ser$i es that ha$e indi$idua& ta, rates. 176. M" proposa&s fro! ser$i e ta, are e,pe ted to "ie&d an additiona& re$enue of ` 14,220 rore. Ieeping in !ind that the share of ser$i es in ./P is A3 per ent, "ou #ou&d agree that the proposed in rease is not too harsh. I sha&& no# dea& #ith proposa&s re&ating to the other indire t ta,es. 177. In the #ake of the g&oba& finan ia& risis in 2004-03, the standard rate of e, ise dut" for non-petro&eu! goods #as redu ed fro! 15 per ent to 4 per ent in a phased !anner. 'his rate #as raised fro! 4 per ent to 10 per ent in Budget 2010-11. .i$en the i!perati$e for fis a& orre tion, I propose to no# raise the standard rate fro! 10 per ent to 12 per ent, the !erit rate fro! A per ent to 2 per ent, and the &o#er !erit rate fro! 1 per ent to 2 per ent. ?o#e$er, the &o#er !erit rate for oa&, ferti&isers, !obi&e phones and pre ious !eta& je#e&&er" is being retained at 1 per ent. 178. Garge ars urrent&" attra t e, ise dut" depending on their engine apa it" and &ength. In keeping #ith the in rease proposed in the standard rate, I propose to enhan e the dut" fro! 22 per ent to 25 per ent. In the ase of ars that attra t a !i,ed rate of dut" of 22 per ent E `1A000 per $ehi &e, I propose to in rease the dut" and s#it h o$er to an ad valorem rate of 2D per ent. 17&. Co hange is proposed in the peak rate of usto!s dut" of 10 per ent on non-agri u&tura& goods. Barring a fe# indi$idua& ite!s, the rates be&o# the peak are a&so being retained.

180. I sha&& no# take up re&ief proposa&s for spe ifi se tors O espe ia&&" those under stress. 'hese ha$e been for!u&ated to sti!u&ate in$est!ent and !anufa turing gro#th. Agriculture - Related Sectors 181. >arr"ing for#ard the initiati$es taken for agri u&ture and agro-pro essing in the pre$ious Budgets, I propose; < to redu e basi

usto!s dut" fro! D.A per ent to 2.A per ent on;

sugar ane p&anter, root or tuber rop har$esting !a hine and rotar" ti&&er and #eeder= parts for the !anufa ture of these=

< < < <

to redu e basi usto!s dut" fro! D.A per ent to A per ent on spe ified offee p&antation and pro essing !a hiner"= to e,tend proje t i!port benefit to green house and prote ted u&ti$ation for horti u&ture and f&ori u&ture at on essiona& basi usto!s dut" of A per ent= to redu e basi usto!s dut" on so!e #ater so&ub&e ferti&isers and &i*uid ferti&isers, other than urea, fro! D.A per ent to A per ent and fro! A per ent to 2.A per ent= to e,tend on essiona& i!port dut" a$ai&ab&e for insta&&ation of Me hanised ?and&ing @"ste!s and Pa&&et Ba king @"ste!s in !andis or #arehouses for horti u&tura& produ e.

182. I!ports of e*uip!ent for initia& setting up or substantia& e,pansion of ferti&iser proje ts are being fu&&" e,e!pted fro! basi usto!s dut" of A per ent for a period of three "ears up to Mar h 31, 201A. nfrastructure 183. In the rea&! of infrastru ture !" proposa&s address so!e #eaknesses in the troika of po#er, oa& and rai&#a"s. 184. /o!esti produ ers of ther!a& po#er ha$e been under stress be ause of high pri es of oa&. I propose to ease the situation b" pro$iding fu&& e,e!ption fro! basi usto!s dut" and a on essiona& >J/ of 1 per ent to @tea! oa& for a period of t#o "ears ti&& Mar h 31, 2015. Fu&& e,e!ption fro! basi dut" is a&so being pro$ided to the fo&&o#ing fue&s for po#er generation; < < Catura& .as and Gi*uified Catura& .as= and Uraniu! on entrate, @intered Uraniu! /io,ide in natura& and pe&&et for!.

Mining 185. Better sur$e"ing and prospe ting for !inera&s are essentia& for i!pro$ing the produ ti$it" and effi ien " of our !ining se tor. I propose to redu e basi usto!s dut" on !a hiner" and instru!ents for sur$e"ing and prospe ting fro! 10 per ent or D.A per ent to 2.A per ent. In addition, fu&& e,e!ption fro! basi usto!s dut" is being pro$ided to oa& !ining proje ts.

Rail&ays 186. 6$er the ne,t fi$e "ears, Indian Bai&#a"s are undertaking t#o !ajor proje ts for passenger safet" and better ser$i e de&i$er". 'hese are - the insta&&ation of 'rain Prote tion and %arning @"ste! and upgradation of tra k stru ture for high speed trains. I propose to redu e basi usto!s dut" on e*uip!ent re*uired for their i!p&e!entation fro! 10 per ent to D.A per ent. Roads 187. Fu&& e,e!ption fro! i!port dut" on spe ified e*uip!ent i!ported for road onstru tion b" ontra tors of Ministr" of Boad 'ransport and ?igh#a"s, C?7I and @tate .o$ern!ents is being e,tended to ontra ts a#arded b" Metropo&itan /e$e&op!ent 7uthorities. 188. 'unne& boring !a hines and parts for their asse!b&" are o$ered b" this e,e!ption. I propose to a&&o# their i!port free of dut" #ithout end-use ondition. !ivil Aviation 18&. India has potentia& for estab&ishing itse&f as a hub for third-part" Maintenan e, Bepair and 6$erhau& 0MB61 of i$i&ian air raft. 'o a tua&i)e this potentia&, I propose to fu&&" e,e!pt fro! basi usto!s dut" parts of air raft and testing e*uip!ent i!ported for this purpose. 7s a !easure of support to the air&ine industr", it is a&so proposed to fu&&" e,e!pt both ne# and retreaded air raft t"res fro! basi usto!s dut" and e, ise dut". Manufacturing 1&0. M" proposa&s for the !anufa turing se tor that needs support at this jun ture, seek to pro$ide re&ief through ost redu tion of ra# !ateria&s, inputs, o!ponents and apita& goods. 1&1. 'o en ourage enri h!ent of &o#-grade iron ore, of #hi h #e ha$e huge reser$es, I propose to redu e basi usto!s dut" on p&ant and !a hiner" i!ported for setting up or substantia& e,pansion of iron ore pe&&et p&ants or iron ore benefi iation p&ants fro! D.A per ent to 2.A per ent. M" other proposa&s re&ating to the stee& se tor are as under; < to redu e basi

usto!s dut" on;

oating !ateria& for !anufa ture of e&e tri a& stee& fro! D.A per ent to A per ent ni ke& ore and on entrate and ni ke& o,ideF h"dro,ide fro! 2.A per ent or D.A per ent to Ci&

< <

to enhan e e,port dut" on hro!iu! ore fro! `3000 per tonne to 30 per ent ad $a&ore! to enhan e basi per ent. usto!s dut" on non-a&&o", f&at-ro&&ed stee& fro! A per ent to D.A

1&2. 6ur te,ti&e industr", espe ia&&" the #ea$ing se tor, urgent&" needs to !odernise. I propose to fu&&" e,e!pt auto!ati shutt&e-&ess &oo!s fro! basi usto!s dut" of A per ent. @i!i&ar&", fu&& e,e!ption fro! basi dut" is being a orded to auto!ati si&k ree&ing and pro essing !a hiner" as #e&& as its parts. It is a&so proposed to restri t these e,e!ptions and the

e,isting on essiona& rate of basi usto!s dut" of A per ent on&" to ne# te,ti&e !a hiner". @e ond-hand !a hiner" #ou&d no# attra t basi dut" of D.A per ent. 6ther proposa&s on te,ti&es are; < < < to redu e basi per ent to redu e basi usto!s dut" on #oo& #aste and #oo& tops fro! 1A per ent to A usto!s dut" on 'itaniu! dio,ide fro! 10 per ent to D.A per ent

to e,tend fu&& e,e!ption fro! basi usto!s dut" to ara!id "arn and fabri used for the !anufa ture of bu&&et proof he&!ets

1&3. (, ise dut" of 10 per ent is app&i ab&e to branded read"-!ade gar!ents #ith abate!ent of AA per ent fro! the Betai& @a&e Pri e. 7&ong #ith in rease in dut" to 12 per ent, I propose to enhan e the abate!ent to D0 per ent. 7s a resu&t, the in iden e of dut" as a per entage of the Betai& @a&e Pri e #ou&d o!e do#n fro! 5.A per ent to 3.2 per ent. 1&4. 6ur M@M( se tor is ferti&e ground for the produ tion of &o#- ost !edi a& de$i es. In order to pro$ide i!petus to this se tor, I propose to redu e basi usto!s dut" to 2.A per ent #ith on essiona& >J/ of 2 per ent on spe ified parts, o!ponents and ra# !ateria&s for the !anufa ture of so!e disposab&es and instru!ents. Fu&& e,e!ption fro! basi usto!s dut" and >J/ is a&so being e,tended to spe ified ra# !ateria&s for the !anufa ture of oronar" stents and heart $a&$es. 'hese on essions #ou&d be subje t to a tua& user ondition. 1&5. M" other proposa&s to support the !anufa turing se tor in &ude; < Fu&& e,e!ption fro! basi

usto!s dut" on

#aste paper, G>/ and G(/ 'J pane&s, and parts of !e!or" ard for !obi&e phones

<

Bedu tion of basi usto!s dut" on spe ified ra# !ateria&s for the !anufa ture of adu&t diapers fro! 10 per ent or D.A per ent to A per ent #ith >J/ of 2 per ent and ni& spe ia& >J/.

1&6. M" attention has been dra#n to the p&ight of a fe# se tors that are high&" &abourintensi$e and produ e ite!s of !ass onsu!ption. 7s a !easure of support, I propose to enhan e basi usto!s dut" on bi " &es fro! 10 per ent to 30 per ent and on bi " &e parts fro! 10 per ent to 20 per ent. 1&7. Fu&& e,e!ption fro! e, ise dut" is urrent&" a$ai&ab&e to hand-!ade !at hes #hi&e others attra t the standard rate. It is proposed to redu e e, ise dut" on !at hes !anufa tured b" se!i-!e hanised units fro! 10 per ent to 2 per ent. $ealt( and %utrition 1&8. It is proposed to e,tend on essiona& basi usto!s dut" of A per ent #ith fu&& e,e!ption fro! e, ise dut"F>J/ to si, spe ified &ife-sa$ing drugsF $a ines. 'hese are used for the treat!ent or pre$ention of ai&!ents su h as ?IJ-7I/@, rena& an er, et .

1&&. Protein defi ien " a!ong #o!en and hi&dren is one of the !ost o!!on sour es of !a&nutrition in India. I propose to redu e basi usto!s dut" on @o"a protein on entrate and iso&ated so"a protein fro! 30 per ent or 1A per ent respe ti$e&" to 10 per ent. @i!u&taneous&", e, ise dut" on a&& pro essed so"a food produ ts is being redu ed to the !erit rate of 2 per ent. 200. >onsu!ption of iodised sa&t pre$ents iodine defi ien " and re&ated diseases. I propose to pro$ide a on essiona& basi usto!s dut" of 2.A per ent a&ong #ith redu ed e, ise dut" of 2 per ent on iodine. 201. Probioti s are a ost-effe ti$e !eans of o!bating ba teria& infe tions. It is proposed to redu e the basi usto!s dut" on this ite! fro! 10 per ent to A per ent. Environment 202. In order to fu&&" rea&ise our potentia& in the rea&! of so&ar energ", so&ar ther!a& proje ts need en ourage!ent. I propose to fu&&" e,e!pt p&ant and e*uip!ent et . for the initia& setting up of su h proje ts fro! spe ia& >J/. 203. >on essions ha$e a&read" been pro$ided for en ouraging the onsu!ption of energ"sa$ing de$i es. I propose to fu&&" e,e!pt a oating he!i a& used for o!pa t f&uores ent &a!ps, fro! basi usto!s dut". (, ise dut" on G(/ &a!ps is a&so being redu ed to 2 per ent. 204. @pe ified parts re*uired for the !anufa ture of h"brid $ehi &es enjo" fu&& e,e!ption fro! basi usto!s dut" and spe ia& >J/ #ith on essiona& e, ise dut"F >J/ of 2 per ent. 'his on ession is being e,tended to spe ified additiona& ite!s and &ithiu! ion batteries i!ported for the !anufa ture of batter" pa ks for supp&" to e&e tri or h"brid $ehi &e !anufa turers. 205. 6ne of the pri!ar" dri$ers of the urrent a ount defi it has been the gro#th of a&!ost A0 per ent in i!ports of go&d and other pre ious !eta&s in the first three *uarters of this "ear. I ha$e been ad$ised to strengthen the steps a&read" taken to he k this trend for better resu&ts. I propose to in rease basi usto!s dut" on standard go&d bars= go&d oins of purit" e, eeding 33.A per ent and p&atinu! fro! 2 per ent to 5 per ent and on non-standard go&d fro! A per ent to 10 per ent. In s"n #ith these, basi dut" on go&d ore, on entrate and dore bars for refining is being enhan ed fro! 1 per ent to 2 per ent. 6n the e, ise side, dut" on refined go&d is being in reased in the sa!e proportion fro! 1.A per ent to 3 per ent. 206. In order to pre$ent round-tripping, it is proposed to i!pose basi ent on ut and po&ished, o&oured ge! stones at par #ith dia!onds. usto!s dut" of 2 per

Additional Resource Mobilisation 207. I sha&& no# take up !" proposa&s on 9de!erit: goods. I propose to in rease basi e, ise dut" on igarettes of !ore than 2A!! &ength b" adding an ad valorem o!ponent of 10 per ent to the e,isting spe ifi rates. 'he ad valorem dut" #ou&d be hargeab&e on A0 per ent of the Betai& @a&e Pri e de &ared on the pa k. 208. I a&so propose to arr" out a no!ina& in rease in basi e, ise dut" on hand-ro&&ed bidis fro! `4 to `10 per thousand and on !a hine-ro&&ed bidis fro! `13 to `21 per thousand. 'he e,isting e,e!ption a$ai&ab&e to hand-ro&&ed bidis for &earan es up to 20 &akh bidis per annu! is being retained.

20&. Pan !asa&a, gutkha, he#ing toba o, un!anufa tured toba o and )arda s ented toba o in pou hes are &e$iab&e to e, ise dut" under the o!pounded &e$" s he!e. 'he rates of dut" spe ified per pa king !a hine for these ite!s are being stepped up taking into a ount i!pro$e!ents in the effi ien " of !a hines used b" this industr". 210. >rude petro&eu! oi& produ ed in India attra ts a ess of `2,A00 per !etri tonne under the 6i& Industries /e$e&op!ent 7 t. 'his rate #as &ast re$ised in Budget 2002-0D. 7s a !easure of inde,ation, I propose to in rease the rate of ess to `5,A00 per !etri tonne. 211. >o!p&ete&" Bui&t Units of &arge arsF MUJsF @UJs ha$ing engine apa it" abo$e a pres ribed thresho&d and #hose $a&ue e, eeds U@ do&&ar 50,000 per $ehi &e are per!itted for i!port #ithout t"pe appro$a&. Basi usto!s dut" on su h $ehi &es is being enhan ed fro! 20 per ent to DA per ent ad valorem. Rationalisation Measures 212. Pa kaged e!ent, #hether !anufa tured b" !ini- e!ent p&ants or others, attra ts differentia& e, ise dut" depending on the Betai& @a&e Pri e per bag. It is proposed to pres ribe a unified rate of 12 per ent E `120 PM' for non-!ini e!ent p&ants and 2 per ent E `120 PM' for !ini- e!ent p&ants. It is proposed to harge this dut" on the Betai& @a&e Pri e &ess abate!ent of 30 per ent. 213. 'he ?ouse #ou&d re a&& that I had re-introdu ed a &e$" of e, ise dut" of 1 per ent on branded pre ious !eta& je#e&&er" in the &ast Budget. 7s a !easure of rationa&isation, I propose to in &ude je#e&&er", not bearing a brand na!e, under its a!bit. ?o#e$er, to si!p&if" its operation and !ini!ise its i!pa t on s!a&& artisans and go&ds!iths, I propose; < < < < 214. to harge this dut" on tariff $a&ue e*ua& to 30 per ent of the transa tion $a&ue= to e,tend s!a&&-s a&e e,e!ption up to annua& turno$er not e, eeding `1.A rore for units ha$ing a turno$er be&o# ` 5 rore in the pre$ious "ear= to o!pute turno$er on the basis of tariff $a&ue= and to p&a e the onus of registration and pa"!ent on the person #ho gets je#e&&er" !anufa tured on job-#ork.

I propose to fu&&" e,e!pt branded si&$er je#e&&er" fro! e, ise dut".

215. Bui&ding of o!!er ia& $ehi &e bodies is urrent&" e,e!pt fro! e, ise dut". In &ieu of this dut", a spe ifi rate of `10,000 is being harged on hassis in addition to the app&i ab&e ad $a&ore! dut". 'his dut" stru ture is regressi$e. It is proposed to on$ert the spe ifi o!ponent of dut" to an ad $a&ore! rate of 3 per ent. 216. In the &ast Budget, e, ise dut" e,e!ption on ships and $esse&s in &uding dredgers #as #ithdra#n. 7 ording&", >J/ of A per ent be a!e &e$iab&e on their i!ports. 7s the intention #as not to &e$" this dut" on the i!port of foreign-going $esse&s, I propose to e,e!pt su h $esse&s fro! >J/ retrospe ti$e&". ?o#e$er, to ensure that ships, $esse&s and dredgers !anufa tured in

India do not fa e disabi&it" $is-P-$is foreign-going ships ne essar" safeguard is being pro$ided.

on$erting into

oasta& $esse&s,

Baggage Allo&ance 217. Baggage a&&o#an e for Indians tra$e&&ing abroad #as &ast re$ised in 2005. I propose to in rease the dut"-free a&&o#an e for e&igib&e passengers of Indian origin fro! `2A,000 to `3A,000 and for hi&dren of up to 10 "ears fro! `12,000 to `1A,000. 218. M" proposa&s re&ating to >usto!s and >entra& e, ise are esti!ated to resu&t in a net re$enue gain of ` 2D,240 rore for a fu&& "ear. 21&. M" proposa&s on /ire t 'a,es are esti!ated to resu&t in a net re$enue &oss of `5A00 rore for the "ear. Proposa&s re&ating to Indire t 'a,es are esti!ated to resu&t in a net re$enue gain of `5A,350 rore, &ea$ing a net gain of `51,550 rore in the Budget. 220. For the Indian e ono!", this #as a ha&&enging "ear. 7 nu!ber of g&oba& and do!esti fa tors !i&itated against the gro#th that had re$i$ed in the &ast t#o "ears. But India has thri$ed under ha&&enges and India #i&& do so no#. In the !idd&e of e$er" risis, there is a&so an opportunit". It is an opportunit" to re-think, re-assess and !ake #a" for ne# ideas and po&i ies. It is in this spirit that I approa hed the Budget of this "ear. 'he ai! is to reate an enab&ing at!osphere for orporates, far!ers, entrepreneurs and #orkers to take initiati$es for robust gro#th. 'he ai! is a&so to ensure that the benefits of gro#th rea h a&& se tions of popu&ation. India stands on the brink of a !ajor resurgen e. %hether or not toda"-s announ e!ents !ake to!orro# !orning-s head&ines !atters &itt&e, as &ong as the" he&p in shaping the head&ines that des ribe India a de ade fro! no#. Mada! @peaker, #ith these #ords, I o!!end the Budget to the ?ouse.