New Delhi, February 26
Infrastructure development has received major attention from Finance Minister Pranab Mukherjee in his Union Budget for the financial year 2010-11 with a lion's share of Rs 1.73 lakh crore allocated to the sector from the total plan allocations.

In the Budget for 2010-11, the sector, which includes roads, ports, airports and railways, will claim as much as 46 per cent of Rs 3.73 lakh crore of the total plan outlay.

"I propose to maintain the thrust for upgrading infrastructure in both rural and urban areas," Mukherjee said while presenting the budget for the financial year ahead.

There has been a major increase in allocation for the road development. Of the total allocation for the infrastructure sector, those for roads and railways account for Rs 36,646 crore, an increase of about Rs 3,500 crore.

Mukherjee said in order to make a visible impact on the road sector, the government has made changes in the policy framework for public-private-partnership (PPP) projects and has targeted construction of national highways at the pace of 20 km per day.

He said allocation for road transport sector has been increased by 13 per cent. "For the year 2010-11, I propose to raise the allocation of road transport by over 13 per cent from Rs 17,520 crore to Rs 19,894 crore," he added. He proposed to raise the allocation for railways by Rs 950 crore in 2010-11 compared with Rs 16,752 crore last year to help it expand its network.

"I have provided Rs 16,752 crore in the Budget for 2010-11 for railways to lend her a helping hand," he said. The massive allocation for the railways has come despite Railway Minister Mamata Banerjee not being able to put her ministry’s demands in front of the Finance Minister in time.

Mukherjee said in order to complement the dedicated freight corridor, the Delhi-Mumbai Industrial Corridor project has been taken up for integrated regional development. About India Infrastructure Finance Company Ltd (IIFCL), set up by the government to provide long term financial assistance to infrastructure projects, he said its disbursements are expected to touch Rs 9,000 crore by March 2010 and reach around Rs 20,000 crore by March 2011. "The IIFCL has also been authorised to refinance bank lending to infrastructure projects. It has refinanced Rs 3,000 crore during the current year and is expected to more than double that amount in 2010-11.

New Delhi, February 26
The government today showed its intent to speed up modernisation of the armed forces and allocated Rs 60,000 crore for capital expenses of the Defence Ministry to acquire new weapons, systems, aircrafts, choppers, ships, vehicles and armaments.

Another sum of Rs 87,344 crore has been allocated for revenue (net) expenditure making it Rs 1,47, 344 crore outlay or 13. 3 per cent of the entire Union Budget. The overall raise in the defence budget is about 4 per cent over last year’s allocation of Rs 1,41,703 and 8. 13 per cent over the revised estimates of Rs 1,36,264 crore. This is a far cry from the whopping eyebrow-raising 34 per cent hike effected last year in the run-up to the General Election in May.

The real picture is the focus of the allocation for capital expenses. Last year this stood at Rs 54,824 crore, which later had been pruned down to Rs 47,824 crore in revised estimates in the middle of the last fiscal. Effectively, today’s allocation in the capital outlay is Rs 12,276 crore, or about 25 per cent more than last year’s revised outlay. Out of the Rs 60,000 crore capital outlay, the Indian Air Force has got the biggest chunk of Rs 24,954 crore. The Army got Rs 16,969 crore, Navy Rs 2,972 crore, Naval Fleet Rs 6,950 crore, Naval Dockyards Rs 417 crore.

Explaining this, officials said the IAF is set to purchase some 126 multi-role fighters, it has floated a tender for attack choppers and also transport choppers besides new training aircraft for its fighter pilots. It is also set to purchase critical equipment for air defence.

Besides this major equipment that could come up for purchase includes the sea-borne aircraft carrier, Admiral Gorshkov and large landing ships. The Army will be buying heavy vehicles worth Rs 1074 crore while Rs 4,722 crore has been allocated for the Army’s construction activity.

Of the revenue budget allocation of Rs 87, 344 crore, the Army was provided Rs 57,330 crore, Navy Rs 9,330 crore, Air Force Rs 15,211 crore, Ordnance Factories Rs 246 crore and the DRDO Rs 5,230 crore.

The expense on the revenue side has come down as the arrears of the 6th Pay Commission, about Rs 3,500 crore, were paid off during the ongoing fiscal. Commenting on the allocation, Minister of State for Defence MM Pallam Raju told reporters that its was a “reasonable” budget for his ministry in view of the Rs 60,000 crore capital outlay. “The amount of Rs 60,000 crore earmarked for capital expenditure should be substantial for modernisation and acquisitions,” he said when asked if the budget for his ministry was on expected lines.

New Delhi, February 26
Social sector today walked away with the second highest plan allocation in the Union Budget announced by Finance Minister Pranab Mukherjee in Lok Sabha. With 37 per cent of the total plan outlay for 2010-2011 reserved for social schemes, the sector stands next only to infrastructure in terms of priority; the latter was the top gainer today, wresting 46 per cent of the plan allocation.

Though the Finance Minister hiked budgetary support to all ministries, including Human Resource Development, Health, Rural Development, Urban Development, and Labour, the cream went to the Ministries of Social Justice and Welfare, Minorities and Women and Child Development.

Budget for the Social Justice Ministry saw the highest raise today at 80 per cent --- from Rs 2500 crore last year to Rs 4500 crore for 2010-2011. New funds will provide more money for post-matric scholarship schemes for SCs and OBC students. “This revision was long overdue,” Pranab said, announcing a major hike in budget for SCs/STs and OBCs, from Rs 1968 crore last year to Rs 3581 crore today.

The allocation is also meant to help establish the Indian Sign Language Research and Training Centre for the hearing impaired and aid the setting up of District Disability Rehabilitation Centres in 50 additional districts, along with two composite regional centres for persons with disabilities.

Both Ministries of Minority Affairs and Women and Child Development got 50 per cent more budget than the last year. The government announced a special scheme to benefit women farmers. Called, Mahila Kisan Sashastrikaran Pariyojana, the scheme has been allocated Rs 100 crore in the current fiscal year. Enhanced allocations for women are meant to fend for the Mission for Empowerment of Women, to be set up shortly and the expansion of ICDS services where allocation has been upped from Rs 6,026 crore to Rs 7,806 crore.

Child welfare schemes have received a major boost this year, with a budgetary support of Rs 9,275 crore as against Rs 6,405 crore last year --- a hike of almost Rs 3,000 crore. Money for women welfare schemes has also been increased from Rs 6,652 crore to Rs 9,929 crore --- a raise of almost 50 per cent.

New Delhi, February 26
India will levy a tax on coal and use the money to start a national fund to back renewable energy projects in its effort to promote clean environment. In the Budget 2010-11, Finance Minister Pranab Mukherjee has proposed several steps to “ameliorate negative environmental consequence and increased pollution levels associated with industrialisation and urbanisation”.

The clean energy cess of Rs 50 per tonne will be levied on coal produced in India as well as on the imported. As per the government’s economic survey, power producers in India used 375 million tonnes of domestic and imported coal.

As per the Finance Minister, in many parts of the country pollution level had reached alarming proportions. “While it must be ensured that the principle of a ‘polluter pays’ remains the basic guiding criteria for pollution management, there should also be a positive thrust for development of clean energy,” he said.

The new levy will help raise money for building the corpus of the National Clean Energy Fund for funding research and innovative projects in clean energy technology. Congress’ detractors, however, feel that the cess will be passed on to consumers, making power more dearer.

Mukherjee also proposed tax incentives to help boost investment in solar, wind and geothermal power generation. A target of installing 20,000 megawatts of solar power capacity by 2020 has been set and to meet that goal, the government will provide a concessional import tax rate of 5 per cent on machinery and equipment needed to set up solar power plants.The government will exempt solar equipment, parts for rotor blades used in wind turbines, and electric vehicles from a tax on the production of goods. Ground source heat pumps used to tap geo-thermal energy have been exempted from basic customs duty and special additional duty. Central excise duty on LED lights, which are highly energy-efficient source of energy, has been reduced from 8 to 4 per cent at par with CFLs.

To remedy the difficulty faced by manufacturers of electric cars and vehicle in neutralizing the duty paid on their inputs and components, a nominal duty of 4 per cent on such vehicles has been imposed. Some critical parts of sub-assemblies of such vehicles exempted from basic customs duties and special additional duty subject to actual user condition. These parts would also enjoy a concessional CVD of 4 per cent. A concessional excise duty of 4 per cent has been provided to ‘soleckshaw’, a product developed by CSIR to replace manually operated rickshaws. Its key parts and components will be exempted from custom duty. To encourage the use of bio-degradable materials, the import of compostable polymer has been exempted from basic customs duty.

Mukherjee also proposed a one time grant of Rs 200 crore to Tamil Nadu towards the cost of installation of a zero liquid discharge system at Tirupur to sustain knitwear industry. 

New Delhi, February 26
Air travel on all classes, both domestic and international sectors, is likely to become costlier with the government expanding the scope of air transport services to attract service tax. The memorandum explaining provisions of the 2010-11 Finance Bill, presented by Finance Minister Pranab Mukherjee today, stated: “The scope of air passenger transport service is being expanded to include domestic and international journeys in any class.”

In other words, it means that air travel in all classes, even the economy class, will now come under the service tax umbrella which could result in 10 per cent increase in air fare as currently the service tax is levied at 10 per cent. An additional three per cent is imposed on this 10 per cent as education cess.

Prior to Budget proposal, as far as air travel was concerned, service tax was imposed only on international travel on First and Business classes.

Service tax is given on the base fare component of the air ticket. So, if base fare for a flight, for example Delhi-Mumbai, is say around Rs 3500, fare increase will be Rs 350.

Mukherjee also announced restoration of basic duty on petrol, diesel and crude petroleum and a rise of Re 1 in central excise duty. The five per cent increase in customs duty on import and rise in excise are also likely to impact prices of Air Turbine Fuel, which constitutes around 50 per cent of the airlines’ operational costs in India.

Experts feel oil companies will proportionately pass this on to products other than the LPG and kerosene, which are politically sensitive in nature. The least politically sensitive among all petroleum products is the aviation fuel. Oil marketing companies have also indicated that public sector companies may hike the ATF prices. Experts feel ATF prices can go up by Rs 1200-Rs 1400 per kilo litre. 

New Delhi, February 26
Finance Minister Pranab Mukherjee today presented his fifth Budget in Parliament today but Morarji Desai holds the record of doing so 10 times.Mukherjee, who is holding the portfolio for the second time after his first stint in 1982-1984, is the first and only Finance Minister from West Bengal.

He is behind Yashwant Sinha, who presented seven Budgets, and CD Deshmukh and P Chidambaram, who did it six times each.Bihar's Sinha, who was FM during a brief period of 13 days in 1991, retained the portfolio during 1998-99 and 1999-2002 and presented five final and two interim Budgets. — PTI

New Delhi, February 26
The Indian rupee will this fiscal join the elite league of global currencies like the US dollar, British pound and Euro that have their unique symbols, Finance Minister Pranab Mukherjee said today.

“In the ensuing year, we intend to formalise a symbol for the Indian rupee, which reflects and captures the Indian ethos and culture,” he announced in his Budget speech in Parliament.

“With this, the Indian rupee will join the select club of currencies such as the US dollar, British pound, Euro and Japanese yen that have a clear distinguishing identity,” he said. — PTI