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FM SPEAK 2000
 
Introduction
This budget for 2000-2001 has some other firsts to its credit also. It is the first budget of the new Government which took office in October 1999 under the visionary leadership of Shri Atal Bihari Vajpayee.
 
Fiscal Management
Today, we must squarely confront and overcome the critical challenge posed by a weakening fiscal situation. A long history of high fiscal deficits has left us with a legacy of a huge public debt and an ever-growing bill of interest payments.
 
Agriculture and Rural Development
It is my firm belief that sustained and broad-based growth of agriculture is essential for alleviating poverty, generating incomes and employment, assuring food security and sustaining a buoyant domestic market for industry and services.
 
Rural Housing
"Housing for All" has been identified as a priority area in the Agenda for Governance. For the coming financial year, a goal of providing 25 lakh dwelling units in rural areas has been fixed. Schemes for meeting the needs of different sections of society have been prepared.
 
Social Security for the Poor
More than one third of our population still lives below the poverty line. There is an imperative need to extend some social security cover to the poorest sections of our society.
 
Empowerment of Women
There is an urgent need for improving the access of women to national resources and for ensuring their rightful place in the mainstream of economic development.
 
Population, Health and Environment
Government have recently announced a new National Population Policy a key objective of which is to bring down total fertility rates to replacement levels by 2010.
 
Small Scale Industry
The SSI sector plays a vital role in industrial production, employment generation and exports. In the context of growing domestic and international competition, our strategy is to support this sector through promotional policies of credit and technology.
 
Industry and Capital Market
In earlier millennia, India led the world on the basis of knowledge. Today history is repeating itself. Young Indian entrepreneurs are at the forefront of the infotech revolution, whether in Silicon Valley, Bangalore or Hyderabad.
 
Science and Technology
The sustained growth of our knowledge-based industries will ultimately depend on the quality and extent of scientific and technological progress and training in our society. We must harness our potential in science and technology to realise the dream of modern India envisioned by the Prime Minister in his address to the Indian Science Congress last month.
 
Banking and Finance
The recent East Asian crisis has underlined the critical importance of undertaking reforms to strengthen the banking sector. In recent years, RBI has been prescribing prudential norms for banks broadly consistent with international practice. To meet the minimum capital adequacy norms set by RBI and to enable the banks to expand their operations, public sector banks will need more capital.
 
Infrastructure
Infrastructure services remain a key bottleneck to rapid and sustained growth of our economy.
 
Disinvestment/Privatisation/Public Sector Restructuring
In line with this policy during the last two years financial restructuring of 20 PSUs has been approved by Government.
 
The North-East Region
Government is committed to the speedy economic development of the North-Eastern States and Sikkim. Priority is being given for development of infrastructure, specially airports, railways, power and national highways so as to remove the sense of isolation perceived in many parts of the North-East.
 
Scheduled Castes and Scheduled Tribes
To promote literacy and to improve the education standards of persons belonging to Scheduled Castes, a new thrust will be given to the Post-Matric Scholarship Scheme. The budgetary provision for this Scheme is being increased from Rs.72 crore to Rs.130 crore. Emphasis under this Scheme will be on female literacy.
 
Revised Estimates for 1999-2000
This has been a difficult year for the budget marked by expenditure over-runs and some deceleration in tax collection.
 
Budget Estimates for 2000-2001
In the budget estimates for 2000-2001, the total expenditure is estimated at Rs.3,38,487 crore, of which Rs.88,100 crore is for plan and Rs.2,50,387 crore for non-plan.
 
Plan Expenditure
The budget support for Central, State and UT Plans has been placed at Rs.88,100 crore, marking an increase of Rs.8,705 crore over revised estimates 1999-2000. Gross budgetary support for the Central Plan is being enhanced from Rs.43,661 crore in the revised estimates 1999-2000 to Rs.51,276 crore.
 
Non Plan Expenditure
Non-plan expenditure in 2000-2001 is estimated to be Rs.2,50,387 crore compared to Rs.2,24,343 crore in Revised estimates for 1999-2000, showing an increase of Rs.26,044 crore. The increase in non-plan expenditure is mainly in defence (Rs.10,083 crore), interest payments (Rs.9,841 crore) and in grants to States (Rs.9,392 crore).
 
Indirect Tax Proposals
Sir, I now present my tax proposals. I take up indirect taxes first.
 
Direct Tax proposals
I now turn to my Direct Tax proposals.

 

  
 

 

Union Budget
Budget 1999

Strategy of Budget

Begin process to restore fiscal health of nation by reducing revenue and fiscal deficits.

Revitalise programmes for human resource development to empower the poor.

Undertake major reform of Indirect taxes to boost productivity and employment.

Deepen economic reforms to improve performance of all sectors.

Safeguard economy from international economic turbulence, revive exports and domestic economy.

Strengthen foundations for Science and Technology and realise full potential of knowledge-based industries.

Agriculture

Watershed Development Fund, with Central Government’s matching assistance, with NABARD to cover 100 priority districts within 3 years.

Enhanced Central contribution under the Accelerated Irrigation Benefit Programme to States, which rationalise water rates to cover at least Operations and Maintenance costs.

One time management subsidy and recurring assistance over an initial period of 3 years to all registered Water Users Associations, linked to incremental water rate collection.

A new credit-linked capital subsidy scheme for construction of cold storages and godowns to create additional cold storage capacity of 12 lakh tonnes and to rehabilitate and modernise 8 lakh tonnes of existing units. Also proposed to create 4.5 lakh tonnes of onion storage capacity.

Tax holiday benefit for cold chain/storage facilities.

Experimental scheme of incentive discount to farmers for lifting fertilizer from cooperative societies during April and May.

Special assistance to States for consolidating fragmented land holdings.

Rural Credit

Corpus of Rural Infrastructure Development Fund V enhanced from Rs. 3000 crore to Rs. 3500 crore. The repayment period is also being extended from five to seven years.

Kisan Credit Card Scheme extended to cover two million farmers in 1999-2000. Six lakh cards already issued.

Regional Rural Banks to be recapitalised to the tune of Rs. 168 crore.

NABARD and SIDBI to redouble their efforts for flow of funds to micro enterprises and ensure coverage of at least 50,000 Self-Help Groups during the course of the year.

Lending by banks for food and agro processing industries will be treated as priority sector lending.

National Human Development Initiative with focus on Rural Poor (Year of GRAM SABHA)

Food Security

"ANNAPURNA’ scheme for indigent senior citizens to be provided 10 kg of foodgrain per month free of cost through the Gram Panchayats.

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