HIGHLIGHTS - Budget 2011/12 presented to parliament

NEW DELHI Mon Feb 28, 2011 1:31pm IST

Finance Minister Pranab Mukherjee waves as he leaves his office to present the 2011/12 federal budget in New Delhi February 28, 2011. REUTERS/Vijay Mathur

Finance Minister Pranab Mukherjee waves as he leaves his office to present the 2011/12 federal budget in New Delhi February 28, 2011.

Credit: Reuters/Vijay Mathur

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NEW DELHI (Reuters) - Finance Minister Pranab Mukherjee on Monday presented to parliament the budget for the coming financial year beginning in April.

Following are the highlights of the budget:

BORROWING

* Gross market borrowing for 2011-12 seen at 4.17 trillion rupees (Reuters forecast 4.5 trillion rupees)

* Net market borrowing for 2011-12 seen at 3.43 trillion rupees (Reuters forecast 3.77 trillion rupees)

* Revised gross market borrowing for 2010-11 at 4.47 trillion rupees

FISCAL DEFICIT

* Fiscal deficit seen at 5.1 percent of GDP in 2010-11

* Fiscal deficit seen at 4.6 percent of GDP in 2011-12

* Fiscal deficit seen at 3.5 percent of GDP in 2013-14

SPENDING

* Total expenditure in 2011-12 seen at 12.58 trillion rupees

* Plan expenditure seen at 4.41 trillion rupees in 2011-12, up 18.3 percent

REVENUE

* Gross tax receipts seen at 9.32 trillion rupees in 2011-12

* Corporate tax receipts seen at 3.6 trillion rupees in 2011-12

* Tax-to-GDP ratio seen at 10.4 percent in 2011-12; seen at 10.8 percent in 2012-13

* Customs revenue seen at 1.52 trillion rupees in 2011-12

* Factory gate duties seen at 1.64 trillion rupees in 2011-12

* Non-tax revenue seen at 1.25 trillion rupees in 2011-12

* Service tax receipts seen at 820 billion rupees in 2011-12

* Revenue gain from indirect tax proposals seen at 113 billion rupees in 2011-12

* Service tax proposals to result in net revenue gain of 40 billion rupees in 2011-12

SUBSIDIES

* Subsidy bill in 2011-12 seen at 1.44 trillion rupees

* Food subsidy bill in 2011-12 seen at 605.7 billion rupees

* Revised food subsidy bill for 2010-11 at 606 billion rupees

* Fertiliser subsidy bill in 2011-12 seen at 500 billion rupees

* Revised fertiliser subsidy bill for 2010-11 at 550 billion rupees

* Petroleum subsidy bill in 2011-12 seen at 236.4 billion rupees

* Revised petroleum subsidy bill in 2010-11 at 384 billion rupees

* State-run oil retailers to be provided with 200 billion rupee cash subsidy in 2011-12

GROWTH, INFLATION EXPECTATIONS

* Inflation seen at 5 percent in 2011-12

* Economy expected to grow at 9 percent in 2012, plus or minus 0.25 percent

TAXES

* Standard rate of excise duty held at 10 percent

* Service tax rate kept at 10 percent

* To widen scope of service tax

* To raise minimum alternate tax to 18.5 percent from 18 percent

* Iron ore export duty raised to 20 percent

* Personal income tax exemption limit raised to 180,000 rupees

* To reduce surcharge on domestic companies to 5 percent

DISINVESTMENT

* Disinvestment in 2011-12 seen at 400 billion rupees

POLICY REFORMS

* Foreign direct investment policy to be liberalised further in 2011-12

* To create infrastructure debt funds

* To boost infrastructure growth with tax-free bonds of 300 billion rupees

* Raised foreign institutional investor limit in 5-year corporate bonds for investment in infrastructure by $20 billion

* Food security bill to be introduced this year

* To permit Securities and Exchange Board of India (SEBI) registered mutual funds to access subscriptions from foreign investments

* Public debt bill to be introduced in parliament soon

SECTOR SPENDING

* To allocate more than 1.64 trillion rupees to defence sector in 2011-12

* Corpus of rural infrastructure development fund raised to 180 billion rupees in 2011-12

* To provide 201.5 billion rupees capital infusion in state-run banks in 2011-12

* To allocate 520.5 billion rupees for the education sector

* To raise health sector allocation to 267.6 billion rupees

AGRICULTURE

* To focus on removal of supply bottlenecks in the food sector in 2011-12

* To raise target of credit flow to agriculture sector to 4.75 trillion rupees

* Gives 3 percent interest subsidy to farmers in 2011-12

* Cold storage chains to be given infrastructure status

* Capitalisation of National Bank for Agriculture and Rural Development (NABARD) of 30 billion rupees in a phased manner

* To provide 3 billion rupees for 60,000 hectares under palm oil plantation

* Actively considering new fertiliser policy for urea

FINANCE MINISTER ON THE STATE OF THE ECONOMY

* "Fiscal consolidation has been impressive. This year has also seen significant progress in those critical institutional reforms that will pave the way for double digit growth in the near future."

* "At times the biggest reforms are not the ones that make headlines, but the ones concerned with details of governance which affect the everyday life of aam aadmi (common man). In preparing this year's budget, I have been deeply conscious of this fact."

* Food inflation remains a concern

* Current account deficit situation poses some concern

* Must ensure that private investment is sustained

* "The economy has shown remarkable resilience."

FINANCE MINISTER ON GOVERNANCE

* "Certain events in the past few months may have created an impression of drift in governance and a gap in public accountability ... such an impression is misplaced."

* Corruption is a problem, must fight it collectively

For full coverage of India's Budget 2011, please click here

(Compiled by Henry Foy and Matthias Williams)

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