Plan Budget Estimate - Plan Expenditure

The plan allocation under various heads provided is limited to the provision at the Budget Estimate stage last year, plus additional amounts committed to as part of the two India Stimulus Packages, which has been reflected in the Revised Estimates for 2008-09.

It also reflects a modest increase in Central Assistance to the States to enable the States to complement their budgetary resources.

Total Indian Gross Budgetary Support (GBS) for the Plan at Rs.2,85,149 crore, is 17.16 per cent higher in nominal terms than the Gross Budgetary Support Plan as part of Budget Estimates 2008-09.

Budgetary support for the Plan for 2009-10, in comparison to Budget Estimates 2008-09 has been increased for the Department of Rural Development, the Department of Road Transport and Highways, Indian Railways, Ministry of Power, Department of Industrial Policy and Promotion and Department of Information Technology. This is to address the economic slowdown and meet the requirements of rural and infrastructure development.

In addition, enhanced Plan allocations have been provided for Ministry of Youth Affairs and Sports and Ministry of Culture to ensure availability of adequate resources for the preparations for hosting the Commonwealth Games next year.

The Indian Government, as part of its Interim Indian Budget Estimates, seeks to ensure ongoing support to flagship programmes which directly impact Aam Aadmi:

(i) National Rural Employment Guarantee Scheme (NREGS). Launched in February 2006, it has now been extended to all the districts of the country. During the year 2008-09, employment of 138.76 crore person days, covering 3.51 crore households, has already been generated. The implementation of this programme has resulted in increased wage employment, enhanced wage earnings, improved equity with benefits flowing to SC/ST and women. This has led to increased demand for and consumption of wage goods. The Budget Estimates 2009 propose an allocation of Rs.30,100 crore for the NREGS Scheme for the year 2009-10.

(ii) Sarva Shiksha Abhiyan (SSA). The SSA has made a significant contribution in providing access to and infrastructure for elementary education. 98 per cent of the population have been access to primary schools. The focus of SSA in 2009 is shifting to improve the quality of elementary education. Between 2003-04 and 2008-09, the allocation for this programme has been increased by 571 per cent. For the year 2009-10, the Budget Estimates propose an allocation of Rs.13,100 crore for the SSA programme.

(iii) The National Programme of Mid-day Meals in Schools. This is the world’s largest school feeding programme and has contributed to enhancement of school participation, reduction in class room hunger, and fostering of social and gender parity. The Budget Estimates propose an allocation of Rs.8,000 crore to this Scheme for the year 2009-10.

(iv) The Integrated Child Development Scheme (ICDS). The ICDS was expanded twice in the last five years to cover the hitherto uncovered population centers across the country. The Budget Estimates commit the government to reduce malnutrition levels in the country. The Indian Government has recently adopted the New WHO Child Growth Standards for monitoring growth of children under ICDS. The BUdget Estimates propose an allocation of Rs.6,705 crore for this Scheme for the year 2009-10.

(v) Jawaharlal Nehru National Urban Renewal Mission. This program was launched to give focused attention to integrated development for urban infrastructure and services in mission mode, in identified cities. The Indian Government has developed and extended the Mass Rapid Transport System (MRTS) in major cities like Bengaluru, Chennai, Delhi, Hyderabad, Kolkata and Mumbai. Under Jawaharlal National Urban Renewal Mission, 386 projects amounting to Rs.39,000 crore have been sanctioned as of December 31, 2008. For the year 2009-10, the Budget Estimates propose an allocation of Rs.11,842 crore for this programme.

(vi)Rajiv Gandhi Rural Drinking Water Mission. This program is envisaged to supply safe drinking water to uncovered habitations and slipped back habitations. I propose an allocation of Rs.7,400 crore for this programme for the year 2009-10.

(vii) Total Rural Sanitation Programme. This program is a continuous process. The Budget Estimates propose an allocation of Rs.1,200 crore for this programme for the year 2009-10.

(viii) National Rural Health Mission. This program aims to bring about uniformity in quality of preventive and curative healthcare in rural areas across the country. The Budget Estimates propose an allocation of Rs.12,070 crore for this programme during the year 2009-10.

(ix) Bharat Nirman. This is a time bound plan for building rural infrastructure. It has six components: rural roads, telephony, irrigation, drinking water supply, housing and electrification. There has been all round progress in the implementation of this programme. During 2005-2009, the allocation to this programme has been increased by 261 per cent. For the year 2009-10, the Budget Estimates propose an allocation of Rs.40,900 crore for this programme.

The Unique Identification Authority of India is being established under the aegis of Planning Commission for which a notification has been issued in January 2009, to help insure that the right benefits reach the right constituents. A provision of Rs.100 crore has been made in the Annual Plan 2009-10 for this.

To ensure continuity in financing of rural infrastructure projects, the Budget Estimates propose RIDF-XV with a corpus of Rs.14,000 crore and continuation of the separate window for rural roads with a corpus of Rs.4,000 crore.

To counter the negative impact on exports due to the global financial crisis, the Budget Estimates plan to extend the interest subvention of 2 per cent on pre and post shipment credit for employment-intensive export sectors such as Textiles (including handloom & handicrafts), Carpets, Leather, Gem and Jewellery, Marine products and SMEs beyond March 31, 2009 till September 30, 2009.

This is expected to involve add Rs.500 crore in expenditure to the Budget Estiamtes during Financial Year 2009-10.

The Indian Government is also committed to recapitalizing the public sector banks over next two years to enable them to maintain Capital to Risk Weighted Assets Ratio (CRAR) of 12 per cent and to ensure that credit growth continues to sustain economic growth.

The Finance Minster has presented these Budget Estimates for a Vote-on-Account, but Plan expenditure for 2009-10 may have to be increased substantially at the time of the presentation of the regular Budget, if the global economy continues to deteriorate and additional stimulus is needed to cope with the global recession.

The Indian Government expects it may have to consider additional plan expenditure of anything from 0.5 per cent to 1.0 per cent of the GDP.

Non Plan Budget Estimates - Non Plan Expenditure

Following the Mumbai terror attacks, fundamental defence and security flaws have been exposed.

The Indian Government therefore proposes increasing the allocation for Defence, which is a part of non plan expenditure, to Rs.1,41,703 crore.

This Non Plan Budget Estimate will include Rs.54,824 crore for capital expenditure.

The Budget Estimates also make a provision of Rs.95,579 crore for major subsidies including food, fertilizer and petroleum.

For the fiscal 2009-10, the Interim Budget Estimates forecast Gross Tax Revenue receipts at the existing rates of taxation are estimated at Rs.6,71,293 crore and Centre’s net tax revenue at Rs.5,00,096 crore.

With revenue expenditure estimated at Rs.8,48,085 crore, the revenue deficit amounts to 4.0 per cent of GDP, a considerable increase on previous estimates.

The Indian Fiscal Deficit is estimated at Rs.3,32,835 crore which is 5.5 per cent of GDP. This is lower than in 2008-09, but higher than would be appropriate under normal circumstances. Clearly, the world is not operating under normal circumstances at the moment. The Indian Government is committed to returning to FRBM targets once the economy is restored to its recent trend growth path.

The ceiling of fiscal deficit that the States can incur in 2008-09, in terms of the Debt Consolidation and Relief Facility set up under the Twelfth Finance Commission award, has been increased by 0.5 per cent of the GSDP to 3.5 per cent. The government believes this may have to be reviewed in view of the response of the economy in the coming months.

The Interim Budget - India Interim Budget 2009

Indian Interim Budget 2009 - Background, Overview, Objectives And The Eleventh Five Year Plan

Revised Estimates, Indian Revised Budget Estimates 2008-2009, RE 2008-09

Indian Budget Estimates 2009-2010, BE 2009-2010, Indian Interim Budget

Tax Budget - Tax and Taxes, Indian Interim Budget 2009

Agriculture Budget - Indian Interim Budget 2009, Agricultural Sector, Rural Development Budget

Education Budget - Indian Interim Budget 2009, Education Sector

Social Sector Budget - Indian Interim Budget 2009, Social Sector

Financial Sector Budget - Financial Sector Reforms, Indian Interim Budget 2009

India Budget 2008

Budget Expectations 2008

India Railway Budget 2008