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Return to Main Page of Budget 2004-2005

Indian Budget 2004-05
Full Text of P. Chidambaram, Minister of Finance, Budget Speech(July 8, 2004)


10. One of our greatest assets is our human resources, our people. Empowering the people, especially the poor, with universal access to education and health, and facilitating their full participation in the growth process through gainful employment, will enhance their welfare. It will also reinforce the growth process itself. This win-win strategy is the keystone of the economic policy framework of the Government.

Plan reorientation

11. I have the benefit of the wise counsel of the Prime Minister, Dr Manmohan Singh. In our scheme of things, the poor will have a first charge not only on the additional sum of Rs.10,000 crore of GBS that I propose to provide today, but also on the entire Plan funds that the Planning Commission will reallocate.

12. The poor want basic education for their children: we shall provide it, and we shall make sure that the child remains in school for at least eight years. We shall also make sure that the child is not hungry while she or he is at school. The poor want drinking water: we shall ensure that every habitation has an assured source of drinking water. The poor want basic health care, medicines at fair prices and a doctor within a reasonable distance: we shall ensure that the public health system has adequate human and financial resources to provide basic medical care. The poor want jobs for their children: we shall ensure that through higher investments, and through targeted intervention, jobs are available to them.

13. While the Planning Commission will make the final allocations, I may assure the House that crucial programmes such as Food for Work, Sarva Shiksha Abhiyan, Midday Cooked-Meal Scheme, basic health care, railway moderanisation and safety, Accelerated Irrigation Benefit Programme, drinking water, investment in agriculture, Provision of Rural amenities in Urban Areas (PURA), roads, and science and technology, including bio-technology, will receive priority and will be provided with additional funds.

Antyodaya Anna Yojana

14. I propose to continue, and expand, the Antyodaya Anna Yojana. At present, 1.5 crore families are covered. These families are provided with 35 kg. of foodgrains per family per month at a highly subsidized price of Rs. 2 per kg. for wheat and Rs.3 per kg for rice. 20.76 lakh tonnes of rice and 17.48 lakh tonnes of wheat were distributed under the Scheme in 2003-04. In the current year, I propose to cover 2 crore families. I expect that the off-take of rice and wheat will increase. Consequently, the Antyodaya Anna Yojana will receive a subsidy of nearly Rs.3500 crore. A provision for this level of expenditure has been included in the allocation for food subsidy of Rs.25,800 crore. Public distribution system

15. Fair price shops constitute the backbone of the food security system for the poor. We shall address the weaknesses in the system and strengthen public distribution. I shall return to this subject a little later.

Food for Work Programme

16. Investment and growth will create new job opportunities for our young men and women. Nevertheless, currently there is a need to ensure that unemployment does not take a heavy toll on the poor people. Work has begun on the National Employment Guarantee Act. The object is to guarantee 100 days of employment in a year to one able-bodied person in every poor household. The Bill will take into account the experience gained in Maharashtra. Government will also take care to avoid the pitfalls pointed out by responsible critics. My colleague, the Minister of Labour, expects that he would be able to introduce the Bill in Parliament shortly. Pending the enactment of the new law, I propose to launch a new Food for Work programme in 150 districts classified as most backward and identified as areas in immediate need of such a programme. Allocations under different schemes will be pulled together to support the Food for Work programme. There are substantial funds totalling over Rs.6000 crore under SGRY, SGSY, SJSRY, REGP and PMRY. Depending on the demand for such work, more funds will be allocated in the current year. I expect to increase the allocations substantially over the next four years. Special care will be taken in laying down the guidelines for the programme so that the money and labour expended result in durable and visible assets benefiting the whole community.

Scheduled Castes and Scheduled Tribes

17. The welfare of the Scheduled Castes and Scheduled Tribes is close to my heart. The allocation for programmes concerning the Scheduled Castes is Rs.1180 crore (an increase from Rs.1137 crore) and for Scheduled Tribes is Rs.1146 crore (an increase from Rs.1087 crore). Other plan schemes such as SGSY, SGRY and IAY also contain specific reservations for beneficiaries belonging to the Scheduled Castes and Scheduled Tribes. The reservations range from 50 per cent to 60 per cent.


18. Particular attention will be paid to the welfare, especially education, of the minorities. Hence, an additional allocation of Rs.50 crore has been made for the National Minorities Development and Finance Corporation.

Self-help groups

19. Microfinance initiatives are a cost-effective way to take the banking system to the poor. The Self-Help Group (SHG) – bank linkage programme, initiated in 1992, has come a long way. Until March 31, 2004, 1.67 crore families had benefited through 10.79 lakh SHGs financed by banks. While the SHG concept will be promoted vigorously, I am of the view that matured SHGs may be in a position to graduate from consumption or production credit to starting micro-enterprises. An indicative target of credit linking 5.85 lakh SHGs during the period up to March 31, 2007 has been set for NABARD, SIDBI, banks and other agencies.

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