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India's defence expenditure rises up by Rs 17,071 crore

IRNA - Islamic Republic News Agency

New Delhi, Feb 28, IRNA -- India’s Defence expenditure for the next year (2011-2012) rose up at Rs 1,64,415 crore from Rs 1,457,344 crore, with an increase of Rs 17,071 crore over the last financial year.

This includes a capital expenditure of Rs 69,199 crore to procure modern weapon systems and defence equipment.

'Needless to say, any further requirement for the country's defence would be met,' said Finance Minister, Pranab Mukherjee, Presenting his third Budget in the Lok Sabha (Lower House of Indian Parliament), on Monday in New Delhi.

Meanwhile, the total expenditure proposed for 2011-12 in all sectors, is `12,57,729 crore, which is an increase of 13.4 per cent over the Budget Estimates for 2010-11.

The Plan Expenditure at `4,41,547 crore marks an increase of 18.3 per cent and the Non Plan Expenditure at `8,16,182 crore is an increase of 10.9 per cent over BE 2010-11.

The total plan and non-plan transfers of `2,01,733 crore to States and UT Governments in 2011-12 have increased by 23 per cent over the Budget Estimates 2010-11. This includes grants of `13,713 crore in 2011-12 to local bodies as per the recommendation of the Thirteenth Finance Commission.

Meanwhile, the Budget has raised allocation for social sector spending by 17 per cent to Rs 1,60,887 crore and the allocation for Bharat Nirman programme by Rs 10,000 crore.

Allocation for infrastructure has been increased by over 23 per cent to Rs 2,14,000 crore and the credit to farmers hiked by Rs 1 lakh crore to Rs 4,75,000 crore.

To enhance the flow of funds to the infrastructure sector, the Foreign Institutional Investors limit for investment in corporate bonds, with residual maturity of over five years issued by companies in infrastructure sector, is being raised by an additional limit of US Dollar 20 billion taking the limit to US Dollar 25 billion. This will raise the total limit available to the FIIs for investment in corporate bonds to US Dollar 40 billion.

The Finance Minister preferred not to roll back central excise duty levels to November 2008 and kept it at 10 per cent while he levied a nominal one per cent central excise duty on 130 items that will enter the tax net.

Basic food and fuel items will continue to be exempted while the new levy will not apply to precious metals and stones. Jewellery made of gold, silver and precious metals sold under brand name would be covered by the new levy.

In a massive effort to curb diversion of subsidised items like kerosene, LPG and fertilisers, the Budget proposes to introduce from March next year a scheme that will move towards direct transfer of cash subsidy to people living below poverty line (BPL).

In order to boost development in the North Eastern Region and Special Category States, the allocation for special assistance has been almost doubled to `8,000 crore for 2011-12. Out of this,`5,400 crore has been allocated as untied Special Central Assistance.

The Government’s special support to Jammu & Kashmir is anchored in `28,000 crore Prime Minister's Reconstruction Plan. In addition, for the current year, about 8,000 crore has been provided for the State's development needs. A Task Force to assess infrastructure needs that can be addressed within a time horizon of 24 months for Ladakh and Jammu regions of the State has recommended projects amounting to `416 crore and `497 crore, respectively. I am providing `100 crore for Ladakh and `150 crore for Jammu for these identified projects in 2011-12.

To give a boost to the development of backward regions, the allocation under the Backward Regions Grant Fund has been increased from `7,300 crore to `9,890 crore amounting to an increase of over 35 per cent.

To address problems related to Left Wing Extremism affected districts, an Integrated Action Plan for 60 selected tribal and backward districts has been launched in December 2010. The scheme is being implemented with 100 per cent block grant of `25 crore and `30 crore per district during the years 2010-11 and 2011-12, respectively.

The allocated funds are placed at the disposal of the district level committees who in consultation with local MPs will have the flexibility to spend the amount on development schemes as per the local needs.

Mukherjee's income tax sops included reducing eligibility age of senior citizens from 65 to 60 and enhancing the exemption limit for them from Rs 2.40 lakh to Rs 2.50 lakh. He also created a new category of 'Very Senior Citizens' of 80 years and above who will be eligible for a higher exemption limit of Rs 5 lakh.

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