Home » Indian Budget » Indian Budget 2009-10

Union Budget Highlights

Finance minister Pranab Mukherjee begins presentation of Union Budget 2009-10 in Lok Sabha. Some of the major excerpts of the budget speech are:

• Excise duty on fibre for cheaper cloth reduced
• Excise duty on petrol-driven small trucks reduced to 10%
• 100% deduction in donation to electoral trusts
• Service tax to be levied on law firms
• Exemption of duty on goods made at construction sites restored
• Drugs for heart diseases to become cheaper
• Customs duty on gold and silver import increased
• Customs duty of 5% being levied on import of set-top boxes
• Drugs for heart diseases to become cheaper
• Customs duty on gold and silver import increased
• Commodities Transaction Tax to be rolled back
• Exemption of duty on goods made at construction sites restored
• Mobile phone accessories to become cheaper
• New direct tax code in 45 days
• Set-top boxes to cost more
• Anonymous funds to charitable bodies to get some tax relief
• Small businesses exempt from advance tax
• Custom duty on LCD panels halved
• Customs duty on bio-diesel reduced
• Tax holiday extended for textile units
• Total budget expenditure for 2009-10 will Rs 10,28,032 cr
• Higher public investment in infrastructure
• One lakh dwelling units for paramilitary forces to be built
• Allocation for rehab of Lankan Tamils
• New pension benefits for 12 lakh jawans and JCOs
• Pension of non-commissioned officers to be hiked
• Defence outlay has gone up
• Fringe Benefit Tax to be scrapped
• Eliminate the surcharge on personal Income tax by 10%
• Hike in IT exemption for women to Rs 1,90,000
• Hike in IT exemption to Rs 2,40,000 for senior citizens
• General Sales Tax model will have a Central GST and State GST
• GST to come into effect from April 01, 2010
• Corporate tax unchanged
• Interest subsidy on students' loans in higher education
• Rs 1,000 cr for Aila rehabilitation programme to West Bengal
• Rs 25 cr each for AMU campuses in Murshidabad and Mallapuram
• Rs 2,113 cr for IITs and NITs
• Government to spend Rs.12K cr on rural roads in FY'10
• Commonwealth allocation hiked to Rs 16,300 cr
• Govt to hike allocation to National Ganga Project to Rs 562 cr
• Rs 7000 cr for rural electrification
• Rice, wheat at Rs 3 per kg to the poor
• One rank, one pension for ex-servicemen from July 1
• Allowances to para-military forces at par with defence forces
• Unique Identification ID project to tap private talent
• National action plan on climate change
• Full interest subsidy for students in approved institutions
• Modernisation of national employment exchanges
• 50% cent of rural women in self-help groups
• Real wage of Rs.100/day provided under NREGA
• Allocation of Rs 50 cr to Chandigrah University

• Rs 100 cr one-time grant to expand banks in unbanking areas
• Allocation for PM Gram Sadak Yojna up by 59 per cent
• Work on National Food Security scheme for subsidised food
• Government to shift to nutrient based fertiliser subsidy regime
• Rural mega clusters in Bengal and Rajasthan
• Interest subsidy on education loans
• National Mission for female literacy
• Rural mega clusters in Bengal and Rajasthan
• Interest subsidy for home loans up to Rs 1 lakh
• LNG infrastructure in the country being expanded
• Government to introduce food security bill
• Scheduled commercial bks can set up offsite ATM
• Will create close to 12 million jobs
• Institutional refo reform measures to stabilise BOP
• Aiming for direct transfer of subsidy to farmers
• Rs 4000cr fund to incentivise banks & SFCs to lend
• To provide all possible relief to exporters
• Banking network to be expanded
• One banking centre in every bloc
• Rs 31,100 crore allocation for NREGA
• NREGA gave employment opportunities to more than 4.479 cr households
• Banks, insurance to stay with Government
• Raise threshold for non-promoter public listed companies
• Indira Awaas Yojna hiked by 63% to Rs 8,883 cr
• 1% int subvention to farmers making timely payment
• Allocation to NHAI increased by 23%
• An expert group will look into petroleum product pricing
• GDP grew at 6.7% in 2008-09
• Move towards energy security via Integrated Energy Act
• Saral-II forms to simplify taxation process
• Domestic oil prices must be in sync with global prices
• Raise threshold for non-promoter public listed companies
• Hike in allocation for Mumbai flood management
• LNG infrastructure in the country being expanded
• Total fiscal stimulus during '08-09 is Rs 1,86,000 cr
• Set up a task force for farmer lending
• Allocation of Rashtriya Krishi Vikas Yojna stepped up by 30%
• Additional budget allocation to farmers
• Will ensure farm sector growth at 4%
• Need to strengthen improve regulatory framework
• Private investment has been the key growth driver
• FIIs have returned to India in last few months
• Print media stimulus package extended by six months
• Target for agriculture credit raised to Rs 3,25,000 cr in 2009-10
• Export Credit Guarantee scheme extended till March 2010
• Incentives in interest rates to farmers to pay back
• Agriculture loans in time
• Storm-water drainage project fund hiked to Rs 500 cr
• Blueprint for national gas grid
• IIFCL will refinance 60% of commercial bank loans in PPP
• IIFCL will look at new projects
• IIFCL will also look at incremental lending by banks
• JNNURM allocation hiked by 87 per cent
• Hike infrastructure investment to over 9% of GDP by 2014
• Fund alloction for urban poor accommodation is 3,973,000 cr
• Housing allocation hiked under Rajiv Gandhi Rozgar Yojana
• Trade in goods and services doubled in 2008
• Significant hike in foreign capital
• Need to reduce population below poverty line
• New company IIFCL to look at infrastructure needs
• Signs of revival in the domestic industry
• Fiscal stimulus gave economy a boost
• Govt took 3 stimulus packages to fight slowdown

---

Union Budget to Lay Emphasis on Growth of Social Sector

The finance minister Pranob Mukherjee is all set to present the Union Budget for the financial year 2009-10 on Monday in Parliament. Mukherjee is expected to build on flagship programmes of the UPA government. These programmes include the Rural Health Mission, the National rural Employment Guarantee Scheme and education sector. With the economy showing signs of recovery, the UPA government is all set to focus on the growth of social sector.

---

Expectation from Budget 2009-10

Fringe Benefit Tax - May be reduced or may be removed altogether

Home Loan Benefits - Limit on the deduction of interest may be increased to Rs 2.5 lakh

Tax Saving FDs - Reduce lock-in period for such FDs to three years

Capital Gains Bonds - Permit more companies to issue such tax-saving bonds

Securities Transaction Tax - May be reduced or removed altogether

Taxes on FMCG items - Possible rollback of excise cuts and reduction of VAT

Affordable Housing - Corporates building units of less than 1,000 sq ft area will be exempted from tax on profits

Cheap set-top Boxes - Removal of special additional duty and countervailing duty

PSU Disinvestment - Announce disinvestment in key PSUs and also raise foreign ownership limit in certain sectors

Excise Duty on Cars - Reduction or removal of additional specific duty

---

Finance Minister to Present Union Budget 2009-10 at 11 am

Hopes High for reformist Union Budget from the UPA government

Budget expected to carry forward NREGA and JNNURM schemes