“Kalangathu Kanda Vinaikkan Thulangkathu Thookkang Kadinthu Seyal” (What clearly eye discerns as right, with steadfast will And mind unslumbering, that should man fulfil) - Saint Tiruvalluvar
Key Features of Budget 2013-2014
THE ECONOMY AND THE CHALLENGES Getting back to potential growth rate of 8 percent is the challenge facing the country. Slowdown in Indian economy has to be seen in the context of slowing global economic growth from 3.9 per cent in 2011 to 3.2 per cent in 2012. However, no reason for gloom or pessimism. Of the large countries of the world only China and Indonesia growing faster than India in 2012-13. In 2013-14, only China projected to grow faster than India. Between 2004 and 2008, and again in 2009-10 and 2010-11 the growth rate was over 8 per cent and crossed 9 per cent in four of those six years. 11th Plan period had average growth rate of 8 percent, highest during any Plan period, entirely under the UPA Government. High growth rate can again be achieved through cooperation. ‘Higher growth leading to inclusive and sustainable development’ to be the mool mantra. Government believes in inclusive development with emphasis on improving human development indicators specially of women, the scheduled castes, the scheduled tribes, the minorities and some backward classes. This Budget to be a testimony to that commitment. Fiscal Deficit, Current Account Deficit and Inflation The purpose of Budget to create economic space and find resources to achieve the objective of inclusive development. Dr Vijay Kelkar Committee made its recommendations to Government in September 2012. A new fiscal consolidation path with fiscal deficit at 5.3 per cent of GDP this year and 4.8 per cent of GDP in 2013-14 announced by the Government. Foreign investment in an imperative in view of the high current account deficit (CAD). FII, FDI and ECB three main source of CAD Financing. Foreign investment that is consistant with our economic objectives to be encouraged. Development must be economically and ecologically sustainable and democratically legitimate. Battle against inflation must be fought on all fronts. Efforts in the past few months have brought down headline WPI inflation to about 7 per cent and core inflation to about 4.2 percent. 1
Food inflation is worrying but all possible steps to be taken to augment the supply side to meet the growing demand for food items. Government expenditure has both good and bad consequences and trick is to find the correct level of Government expenditure. Faced with huge fiscal deficit, Government expenditure rationalised in 2012-13. Some economic space retrieved. Space to be used to further Government’s socioeconomic objectives. THE PLAN AND BUDGETARY ALLOCATIONS Revised Estimates (RE) of the expenditure in 2012-13 at 96 per cent of the Budget Estimates (BE) due to slowdown and austerity measures. During 2013-14, BE of total expenditure of ` 16,65,297 crore and of Plan Expenditure at ` 5,55,322 crore. Plan Expenditure in 2013-14 to grow at 29.4 per cent over Revised Estimates for the current year. All flagship programmes fully and adequately funded and sufficient funds provided to each Ministry or Department consistent with their capacity to spend funds. Budget for 2013-14 to have one overarching goal of creating opportunities for our youth to acquire education and skills that will get them decent jobs or selfemployment. SC, ST, Women and Children Allocations for Scheduled Caste Sub Plan and Tribal Sub Plan increased substantially over the allocations of the current year. Funds allocated to these Sub Plans cannot be diverted. ` 97,134 crore allocated for programmes relating to women and ` 77,236 crore allocated for programmes relating to children. Ministry of Women and Child Development to design schemes that will address the concerns of women belonging to the most vulnerable groups, including single women and widows. An additional sum of ` 200 crore proposed to be provided to the...
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