Interim Indian Union Budget 2009-2010: Banknet India

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Interim Indian Union Budget 2009-2010 (16th February 2009)

In view of General elections, Interim Indian Budget has not made any important announcement. It has not changed taxes/duties. This budget is presented to get approval for interim spending plans for the 2009/10 fiscal year from April to July 2009. The requirements for the remaining part of the year are to be voted separately, after the elections.

INDIAN BUDGET HIGHLIGHTS

"In these difficult times, when most economies are struggling to stay afloat, a healthy 7.1 percent rate of GDP growth still makes India the second fastest growing economy in the world," said Finance Minister. India has weathered inflation crisis, but there is no room for complacency. Now is the time for extraordinary measures. There may be a need for additional measures in the post-poll budget. There is a clear need for counter-cyclical policies. There is a need to accelerate policy reforms, including in the financial sector. Mr Mukherjee added that tax rates must fall in times of stress.

Fiscal deficit seen at 5.5 pct of GDP in 2009/10.

Revenue deficit seen at 4 pct of GDP in 2009/10.

Gross market borrowing seen at 3.62 trillion rupees in 2009/10.

Total plan spending in 2009/10 seen at 9.53 trillion rupees.

2009/10 gross budgetary support 2.85 trillion rupees.

GDP growth seen at 7.1 pct in 08/09.

Rural job schemes to get 301 billion rupees in 2009/10.

Rural health spending 120.7 billion rupees.

Midday meals scheme for schools to cost 80 billion rupees.

Urban renewal spending in 2009/10 at 118.4 billion rupees.

Rural sanitation spending seen at 12 billion rupees for next financial year.

2008/09 Data:

2008/09 fiscal deficit seen at 6 percent of GDP.

2008/09 to end with revenue deficit of 4.4 percent of GDP.

2008/09 revised estimate of spending 9.9 trillion rupees.

2008/09 revised estimate of extra non-plan spending 1.1 trillion rupees.

2008/09 revised estimate of tax collection 6.28 trillion rupees.

Apr-Nov FDI registered at $23.3 billion.

Substantial relief of about 400 billion rupees due to tax cuts in 2008/09.

Farm loan waiver has so far cost 653 billion rupees.

>> Further concessions in central excise & service tax announced: Customs duty exemption on naptha extended beyond this fiscal