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Union Budget

2010-11

Presented By:
Bari Prashant Gaurav
Mangal
Bhupesh Gupta Inder Joshi
Bhuwan Bhashkar Karam
Bangur
Deepak Sharma Kumar
Mayank
Gagandeep Singh Mayank
Contents
• 13th Finance Commission
– Economic Overview
– Commission’s Recommendations
• Meaning of Budget
• Budget 2010-11
• Sectors
» Agriculture
» Infrastructure
» Social
» Banking & finance
» IT, Defence, Exports, Textiles, Justice, Environment
• Changes in price
• Tax

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Finance Commission
• It gives recommendations on the distribution
of tax revenue between center & state and
among states themselves.
• 1st commission chaired by K.C. Neogy on 6th
April 1952.
• Commissions have been appointed at
interval of 5 years.
• The 13th finance commission is chaired by
Vijay Kelkar.
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Review of 13th Finance commission
• India can achieve double digit growth and
can become fastest growing economy in
coming four years.
• Manufacturing Sector recorded a growth of
8.6% in 2009-10 which indicate that country
would soon recover from the effect of crisis.
» In 2008- 09, 3.8% growth rate.

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Review of 13th Finance commission
• The Service sector growth decelerated
from 9.7% to 8.7%.

• Due to drought , the kharif crop suffered a


setback, resulting in decline in agriculture
growth by 0.2%.
» 1.6% growth rate in 2008-09.

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Major Recommendation
• Share of central tax to be increase from
30.5 % to 32%.
• Shared tax plus Central grants increased
from 37.6% to 39%
• Grant –in- aid to state over next five years
projected at 3,18,581 crore.
– Out of which 50,000 crore Rs. Reserve for revenue loss
of state government due to GST.

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Major Recommendation
• Fiscal Deficit
– Commission recommend that combined (central and state) debt
should be around 68% of GDP.
» At present 75% of GDP.

– For current year (2010-11) fiscal deficit should not be more than 5.7%
of GDP.
» Last year 6.8%.

– Commission also drawn out a road map for state governments.


• Fiscal deficit should down to 3% of state domestic product by 2014-15.

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Major Recommendation

• Fiscal Deficit

2009-10 2010-11*
6.8% 5.7%

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Major Recommendation
• Goods & Service Tax ( GST)
– Commission recommend 12% rate for GST.

5% central
7% state

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Major Recommendation
• Goods & Service Tax ( GST)
– All direct taxes and cess to be Diluted in GST.
– Diesel, Petrol and Jet fuel to brought under
GST.

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Budget
• The budget is a statement of the
financial position of an administration
for a definite period of time based on
estimates of expenditure during the
period and proposals for financing
them.

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Purpose of Budget
• Provide a forecast of revenues and
expenditures i.e. construct a model of
how our business might perform, if
certain strategies, events and plans are
carried out.

• Enable the actual financial operation of


the business to be measured against
the forecast.

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Budget 2010-11
• Presented by Finance Minister Mr. Pranab
Mukherjee in Lok Sabha on 26th Feb,
2010.

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Budget 2010-11
• The Finance minister lays emphasis on
consolidation growth, improving investment
environment, inclusive development &
strengthening transparency and public
accountability in budget 2010-11.
• The total expenditure proposed in the budget
estimates is Rs.11,08,749 crore, an increase of 8.6
per cent over last year.

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Budget 2010-11
• The plan and non-plan expenditure estimated at
Rs.3,73,092 crore and Rs.7,35,657 crore respectively,
an increase of 15 percent in plan expenditure and 6
per cent in non-plan expenditure over the be of
previous year.
• Fiscal deficit at 5.5 per cent of GDP works out to be
Rs. 3,81,408 crore.

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Budget 2010-11
• Gross tax receipts estimated at Rs.7,46,651 crore and
non-tax receipt estimated at Rs. 1,48,118 crore.
• About Rs. 25,000 crores to be raised through
disinvestment programme.
• Growth of 127 per cent recorded in exports from sezs
till december, 2009.
• Indian rupee to get a symbol, join the select club of
currencies.

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Budget 2010-11
• Agriculture Sector
– Agriculture credit flow target raised to Rs. 3,75,000
crore from rs.3,25,000 crore.
– Subvention for timely repayment of crop loan
increased from 1 per cent to 2 per cent.
– A four-pronged strategy to spur the growth in
agriculture sector envisaged.*
– Extend loan payments for calamity hit farmers.

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Budget 2010-11
• Agriculture Sector
– Development of food processing sector by
providing infrastructure.
– Rs. 300 crores proposed for rashtriya krishi
vikas yojana.
– Five mega food parks to be setup.
– Fertilizer subsidy to be reduced.

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Budget 2010-11
• Infrastructure Sector
– Infrastructure development gets an allocation of Rs.
1,73,552 crore, 46 per cent of total plan allocation.
– Allocation for power sector increased by more than
doubled to Rs. 5,130 crore.
– Allocation for Road & transport raised by 13% i.e.
19,894 crore.
– 25% of planned outlay allocated for rural infrastructure
development.

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Budget 2010-11
• Infrastructure Sector
– Proposed to maintain enthusiasm of upgrading
infrastructure in rural & urban areas.
– New tax incentives announced for the sector.
– National clear energy fund for funding research
and innovative projects in clean energy
technologies to be set up.
– Rs. 48,000 crore allocated for Bharat Nirman
programme.

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Budget 2010-11
• Social sector
– Spending on social sector to account for 37 percent of
total plan outlay at Rs.1,37,674 crore.
– Allocation for NREGA stepped up to 40,100 crore.
– Backward region grant fund allocation enhanced to Rs.
7,300 crore.
– Rajiv Awas Yojna for slum dwellers and urban poor to get
Rs. 1,270 crore , an increase of over 700 per cent.

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Budget 2010-11
• Social sector
– National social security fund for unorganized
sector workers to be set up with an initial
amount of Rs. 1,000 crore.
– Mahila Kisan Sashaktikaran Pariyojna with a
provision of Rs.100 crore launched.

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Budget 2010-11
• Banking & Financial Sector
– Housing loans up to Rs. 3 million would be given
to priority sector lending rates.
– Rs. 16,500 crores to be provided to public sector
banks to achieve minimum 8% tier-i.
– Providing tax breaks on long term infrastructure
bonds issued by banks.
– FDI limit in Insurance sector likely to be increase
to 49%.
– Private investment can sustain 9% growth.
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Budget 2010-11
• Justice
– National mission for delivery of justice and
legal reforms to be set up to provide timely
justice to all.
• Environment & Natural energy
– Special duty concessions to promote clean
environment clean energy cess @ Rs. 50 per
ton on coal.

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Budget 2010-11
• IT Sector
– Technology Advisory Group to function under Mr. Nandan Nilekani.
– Unique identification authority of india to get an allocation of Rs.
1,900 crore.
• Defence Sector
– Allocation for defence increased to Rs.1,47,344 crore.

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Budget 2010-11
• Exports
– 2% interest Subvention for exports extended.
– Interest Subvention to benefit Handicraft, Gems
& Jewellery exports.
• Textiles
– 200 crore allotment to Tripura Textile Sector in
Tamil Nadu.

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Budget 2010-11
• Change in prices.

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Budget 2010-11
Tax Changes
Income Tax Slab
• Upto 1,60,000 Rs. • 160,001- • 5 lakh-8 lakh
5,00,000

20%
Tax Free 10%

For above 8 lakh


30%

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Budget 2010-11
• Corporate Tax surcharge down from 10 to 7.5%.
• Peak custom duty unchanged at 10%.
• 5% custom duty on crude petrol.
• Uniform direct tax decrease by 56000 cr.
• Gross Tax Rcpt. Estimated 746651 cr. Rs.
• Direct Tax to be implemented from 1 April 2011.

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Bibliography

• The Economic times


• Mint
• Deloitte Internal analysis
• www.sharekhan.com
• www.indiabudget.com
• www.rediff.com/business
• www.moneycontrol.com
• Government of India's official website.

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Thank You!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

BUDGET 2010-11

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