Highlights of Indian Budget 2010

Finance Minister of India, Pranab Mukherjee, outlined various plans for 2010. Let’s have a quick look at the highlights of his speech.

According to Pranab, India’s first challenge is to arrive again at 9% GDP growth rate as soon as possible. Internal development of the country highly overlooked, and hence, the finance minister wants to deepen and broaden the agenda.

He sees signs of improvement in domestic investment and foreign investors are being active again. However, he thinks it’s too early to say that the worst is gone. Hence, the country’s economy can be depended on the stimulus package, if things seem wavering again.

A major concern, however, the country faces is the oil price. Due to its inability to get domestic prices down to world level, India has to import around 75% of its total oil consumption, which is definitely not a good sign. Therefore, as an immediate act, the Indian government will set up a group of experts, who would advice the country on petrol consumption and trade decisions.

In the financial year 2010-11, India plans to:

• Raise the limit of non founder holdings in a company
• Provide better flexibility to India Infrastructure Finance Co. Ltd.
• Ask states to minimize holdups of infrastructural projects
• Allocate five billion rupees for the Mumbai Flood Plan
• Expand liquefied Natural Gas Infra
• Increase the funds allocated to National Highway development by 23%
• Achieve agricultural credit amount of 3.25 trillion rupees
• Provide additional 1% subsidy to farmers who payback the loans as scheduled
• Provide 10 billion rupees more for irrigation than it was decided in interim budget
• Extend agriculture debt waiver by further 6 months
• Offer subsidies to farmers directly
• Continue providing financial assistance to exports in seven sectors till the end of financial year 2009-10
• Provide relief to exporters affected by global recession
• Provide 40 billion rupees to promote lending to small firms
• Allocate 1 billion rupees to initiate banking services in un-banked areas
• Promote rural jobs programme by apportioning 391 billion rupees, which is 144% more than it was in 2008-09
• Allocate 59% more funds than it was in 2009-10 for rural roads scheme
• Raise 45% of money allocated to Bharat Nirman Infrastructure Programme
• Assign 20 billion rupees to rural housing under National Housing Bank
• Allocate 70 billion rupees for electrification scheme in rural areas
• Establish 1 power loom cluster and 2 handloom clusters