Union Budget 2012 India Presentation

8/2/2019 Union Budget 2012 India Presentation

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Union Budget 2012-13Key Highlights

A Roadto RecoveryPresentation by

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Presented on 16th Mar 2012

Finance Minister Shri PranabMukherjee Presented

Union Budget 2012, the 81st

Budget in India's history.Individually, this is

Mukherjee's seventh annualBudget, Second-highest by

any Finance Minister.

Applicable from 1st April

2012
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Approach to the Budget

GDP is estimated to grow by 6.9% in 2011-12, after having grown at 8.4%in precedingtwo years.

Key reasons for the interruption of Indianeconomy: euro zone crisis, economy, politicalturmoil in Middle East and rise in crude oil

price.

Growth moderated due to tight monetarypolicy.

Economy is turning around as core sectorsand manufacturing show signs of recovery.

Twelfth Five Year Plan to be launched with theaim of "faster, sustainable and more
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Overview of IndianEconomy

GDP growth estimated at 6.9% in 2011-12.

Current account deficit at 3.6% ofGDP for 2011-12.

Deterioration in fiscal balance in 2011-12 due to slippages in direct tax revenueand increased subsidies.

India's GDP growth in 2012-13expected to be 7.6% +/- 0.25%. Fiscal deficit for 2012-13 pegged

at Rs 5,13,590 crore, which is 5.1 percent of GDP.
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Subsidies and FDI

Subsidies Efforts to keep central subsidies under 2% of

GDP in 2012-13. Over next 3 year, to befurther brought down to 1.75%.

Subsidies related to administering the FoodSecurity Act will be fully provided for.Disinvestment Policy: For 2012-13, Rs 30,000crore to be raised

through disinvestment.

Foreign Direct Investment: Efforts are on to arrive at a broad-based

consensus to allow FDI in multi-brand retailupto 51%.
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Finance and Infrastructure

Financial Sector:

Rajiv Gandhi Equity Saving Scheme to allow for incometax deduction of50% to new retail investors (whoseannual income is below Rs 10 lakh), who invest upto Rs

50,000 directly in equities. The scheme will have a lock-inperiod of3 years.

Infrastructure and Industrial Development:

During 12th Five Year Plan period, investment ininfrastructure to go up to Rs 50 lakh crore, half of

which is expected from private sector. Tax free bonds of Rs 60,000 crore to be allowed for

financing infrastructure projects in 2012-13. It was Rs30,000 cr in 2011-12.

IIFCL has put in place a structure for credit enhancement

and take-out finance for easing access of credit toinfrastructure projects.


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Direct and Indirect Taxes

Direct Taxes: Exemption limit for the general category of individual

taxpayers proposed to be enhanced fromRs 1,80,000 toRs 2,00,000.

Upper limit of20% tax slab proposed to be raised from Rs

8 lakh to Rs 10 lakh. Proposal to allow individual tax payers, a deduction of uptoRs 10,000 for interest from savings bank accounts.

Senior citizens not having income from business proposedto be exempted from payment of advance tax.

Indirect Taxes:

Standard rate of excise duty to be raised from 10% to 12%,merit rate from 5% to 6% and the lower merit rate from 1%to 2% with few exemptions. Excise duty on large carsalso proposed to be enhanced.

Indirect taxes estimated to result in net revenue gain of45,940 crore


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Education and Security

Education:To ensure better flow of credit to students, a

CreditGuarantee Fundproposed to be setup.

For 2012-13, Rs 25,555 crore provided forRTE-SSA representing an increase of21.7%over 2011-12.

Security

A provision of1,93,407 crore made forDefence services including 79,579 crore forcapital expenditure. Any further requirementto be met.

3,280 crore proposed to be allocated forconstruction of office building of Central


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Budget Estimates 2012-13

Gross Tax Receipts estimated at 10,77,612crore.

Net Tax to Centre estimated at 7,71,071 crore. Non-tax Revenue Receipts estimated at

1,64,614 crore. Non-debt Capital Receipts estimated at 41,650

crore.Total expenditure for 2012-13 budgeted at

14,90,925 crore. Fiscal deficit at 5.9% of GDP in RE 2011-12. Fiscal deficit at 5.1% of GDP in BE 2012-13. Central Government debt at 45.5% of GDP in

2012-13 as compared to Thirteenth Finance

Commission target of 50.5 per cent. Effective Revenue Deficit to be 1.8% of GDP


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More Details on Budget

Civil Aviation:Tax concessions proposed for parts of aircraft

and testing equipment for third partymaintenance, repair and overhaul of civilian

aircraft. External Commercial Borrowing (ECB) to bepermitted for working capital requirement ofairline industry for a period of one year, subjectto a total ceiling of US $ 1 billion.

Power and Coal: Coal India advised to sign fuel supply

agreements with power plants,having long-termpower purchase agreements with DISCOMs andgetting commissioned on or before March 31,

2015.


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Governance andEmployment

UID-Aadhaar n Enrolment of 20 crore persons completed under UID

mission. Adequate funds to be allocated to complete enrolment of another 40 crore

persons.

Employment And Skill Development Allocation of `3915 crore made for National Rural

Livelihood Missionrepresenting an increase of 34 percent.

Allocation for Prime Ministers Employment Generation

Programme increased by 23 per cent to `1,276 crore in2012-13.Skill Development Projects approved by National Skill Development

Corporation expected to train 6.2 crore persons at theend of 10 years.

1,000 cr allocated for National Skill Development Fund


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Health and Social Security

HEALTH No new case of polio reported in last one year. Allocation for NRHM proposed to be increased from `18,115

crore in 2011-12 to `20,822 crore in 2012-13. Pradhan Mantri Swasthya Suraksha Yojana being expanded

to cover upgradation 7 more Government medical colleges.Social Security And The Needs Of Weaker Sections Allocation under NSAP raised by 37 per cent to `8,447 crore

in 2012-13. In the ongoing Indira Gandhi National Widow Pension

Scheme and Indira Gandhi National Disability Pension

Scheme for BPL beneficiaries, pension amount to be raisedfrom `200 to `300 per month. Lump sum grant on the death of primary breadwinner of a

BPL family, in the age group 18-64 years, doubled to`20,000.
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Agriculture

Agriculture Plan Outlay for Department of Agriculture and Co-

operation increased by 18%. Outlay for Rashtriya Krishi Vikas Yojana (RKVY)

increased to `9,217 crore in 2012-13. Initiative of Bringing Green Revolution to Eastern India

(BGREI) has Resulted in increased production andproductivity of paddy. Allocation for the schemeincreased to 1,000 cr in 2012-13 from 400 cr in 2011-12.

Agriculture Credit n Target for agricultural credit raised by `1,00,000 crore

to `5,75,000 crore in 2012-13. Kisan Credit Card (KCC) Scheme to be modified to make

KCC a smart card which could be used at ATMs.


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For a Common Man

Benefits/Advantage Get bit more of salary due to change in Income Tax Slab, No

tax on Interest till 10000, No Tax for unemployed SeniorCitizen.

Low cost and Free education

More Benefits and low tax for Agriculture

Disadvantage Pay more for all consumer goods like Mobile, Computer,

Laptop, AC, Washing machine, Fridge, TV etc

Pay more for Oils and fuels due to reduced Subsidy

Pay more for Excise duty and Service Tax i.e. Pay more inrestaurants, gyms, travel, tour, other all service

Pay high for Cars and SUV
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