Highlights of Union Budget 2006
Highlights of Union Budget 2006
Chidambaram began the Budget speech with a series of sops to boost agriculture and social sectors. The defence allotment, too, has gone up by Rs 6,000 crore and now stands at a record Rs 89,000 crore.

HIGHLIGHTS OF THE UNION BUDGET

  • Gross Capital formation up 30 pc in FY 05
  • Savings up 21.9 pc of GDP
  • Gross capital formation up 30 pc in FY 05
  • Agricultural growth up by 2.1 pc
  • AIM 10 pc economic growth
  • Non-food credit growing by 25 pc
  • Gross capital formation up 30 pc in FY 05
  • 90 pc golden quadrilateral completed by 90 pc in June 2006
  • GDP growth target for tenth plan at 8 pc
  • 11, 7000 spent on rural employment scheme
  • Govt determined to take growth rate to 10 per cent
  • Manufacturing sector to grow at 9.4 per cent in FY 06 07
  • Highway scheme progressing at 4.4 km per day
  • 96 per cent of GQ to end by June 2006
  • Food grain output this year at 209.5 mt
  • 8.7 lakh rural houses constructed by bharat nirman
  • Inflation at 4.02%
  • 5083MW more power to be added in 2006
  • 10,366 villages electrified this year
  • Rs 11,700 cr to be spent on rural employment
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  • Govt's aim is to ensure monetary stability and managing external debt
  • Education outlay Rs 24,115 crore
  • Rs 3010 crore outlay for midday meal scheme
  • Rs 944 crore has been given for irrigation
  • Rs 720 cr for rural sanitation
  • Hyderabad Metro rail to be considered
  • Old age pension (above 75 years) - Rs 200 per month
  • Five lakh additional class rooms to be constructed
  • 1.5 lakh additional teachers to be appointed
  • Allocation for education increased by 31.5 pc to Rs 24,150 crore
  • Allocation for healthcare raised by 22 pc to Rs 12, 546 crore
  • Destitute pensioner to get Rs 400 per month with the help of states
  • Rs 10,041 cr for Sarva Shikhsha Abhiyan
  • Massive polio immunisation programme from 2007
  • 54 pc hike for Bharat Nirmal Programme at Rs 18,696 crore
  • Incentive for girl child who passes 8th standard - Rs 3000 award after she turns 18
  • Gender budgeting on in 32 ministries
  • Rs 24,115 crore for education
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  • Rs 4680 cr outlay for drinking water
  • Total budget for Northeast will be Rs 12,041 crore
  • Rs 1,350 crore for the ministry of NE development
  • Rs 16.4 cr for National Minorities Development Corporation
  • Rs 8207 crore for rural health spending
  • LPG included in list of declared goods under CST Act
  • Rs 4,680 crore for Rajiv Gandhi water drinking plan
  • Rs 16,000 cr allocation for PSUs
  • Expert body to be set up for jems and jewelery sector
  • Farmers to receive short term credit at 7 per cent
  • Gross budgetary support for Plan expenditure up 20.4 pc at Rs 1,74,725 crore
  • Special tea fund of Rs 100 cr for Assam,TN,Kerala, Uttaranchal
  • Stress on development of micro-finance sector
  • Rs 4,595 cr for urban renewal mission
  • Programme for reconstruction of calamity-hit areas.
  • Rs 28,737 crore allocated for gender budgeting
  • Allocation for national Urdu education programme increased to Rs 13 crore
  • Rs 10, 000 cr allocation for rural infrastructure
  • Special schemes for STs and SCs for their development.
  • India to be made manufacturing hub for textiles, steel
  • India to be made manufacturing hub for metals and petro products
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  • Maulana Azad Educational Foundation corpus for minority welfare doubled to Rs
  • 200 crore

  • New towns to be established on specific themes
  • Farm credit to benefit Allahabad Bank and SBI
  • Govt aims to double farm credit in three yrs
  • More infrastructure to benefit cement industry
  • Outcome of Budget to be tabled on March 17
  • 1,000 schools for SCs, STs, OBCs and minorities girls
  • Foreign tourist arrival 3.92 million in 2005
  • Agricultural credit proposed to be increased to RS 175,000 crore
  • 50 lakh additional farmers to be covered
  • Agricultural insurance scheme to continue
  • Central horticulture institute in Nagaland
  • FDI flow put at $4 billion up to November, 2005
  • Budgetary loan for PSEs has been fixed at Rs 16901 crore
  • Budgetary loan of Rs 2791 crore for Railways
  • 4.7 pc growth in power generation in 2005
  • Rs 4,481 crore allocated for improving 20,000 water bodies
  • National fisheries development board to be set up
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  • 82 power projects under construction
  • 4 new hotel management institutes in Chattisgargh, Haryana, Jharkhand and Uttaranchal.
  • Five ultra-mega power projects before Dec 2006
  • Rs 597 cr for non-conventional resources
  • Tourism plan spending at 830 cr
  • National Highway Authority of India to be restructured
  • 2 pc of the borrowers' interest liability up to Rs 1 lakh principal of crop loans taken for kharif and rabi this year is to be reimbursed to farmers before March 31 this year
  • Allocation for Rural Infrastructure Development Fund has been stepped up to Rs 10,000 crore in 2006/07
  • Textile upgradation fund allocation to be raised to Rs 55 crore
  • 12 textile industry parks to be set up
  • An allocation of Rs 189 crore provided for this
  • A National Jute Board to be set up
  • Like woolmark, there will be a handloom mark to certify quality
  • A window to be created for equity participation and viability gap funding for the growth of sunrise IT sector
  • Tax rationalisation for jewelry and gems import
  • Food Processing Sector to be a priority sector for bank credit
  • 15 tourist areas to be developed
  • Services sector put on par with manufacturing sector
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  • SMEs in service sector to get the status of SSI in manufacturing sector
  • Rs 1500 cr allocation to boost telephone connectivity
  • Plan allocation for shipping up 37 pc
  • Bill on cellular telephony in rural areas soon
  • 40,000 more villages to be electrified under Rajiv Gandhi Gramin Vidhyutikaran Yojana
  • 82 power projects are in various stages of implementation in the country to overcome power shortage
  • Work on to identify a deep draft port in West Bengal
  • To promote India as a semi-conductor hub
  • Introduction of a comprehensive bill on insurance in 2007
  • Biotechnology will be the big focus in FY 06-07
  • 180 items to be de-reserved from SSI list
  • Thrust industries: textile and food processing
  • Rs 97 crore for upgrading IITs
  • FII investment limit in stock markets will be raised from $1.75 billion to $2 billion
  • National e-governance plan to be approved shortly
  • Telephone connection on demand in rural areas in three years
  • Raise in the aggregate investment of overseas investors from $1billion to $1 billion
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  • An investment protection fund under the aegis of SEBI would be set up
  • Rs 100 crore special grant for Punjab Agricultural University
  • Food fertilizer and petroleum industries to be under subsidies
  • Defence budget raised to Rs 89,000 crore in 2006-07 from Rs 83,000 crore last year
  • Rs 37,458 crore would be capital expenditure in defence
  • Thrust on farm sector positive for fertilizer companies
  • Govt urges consensus in Parliament on subsidies in fertiliser, petrol and food
  • Allocation to the states from the central pool up to RS 1,03,710 cr from Rs 94,402 cr
  • Revenue deficit to be 2.1 per cent of GDP
  • Fiscal deficit 3.8 per cent of GDP im 2006-07
  • After 20 years, gross fiscal deficit is less than gross budgetary deficit
  • Plan expenditure has gone up to 30.6 per cent
  • Gross tax revenues increases by 19.4 pc in 2004-05

  • Customs primary and non-primary steel and alloy products down to 7.5 pc from 10 pc
  • Customs on mineral products down to 5 pc from 15 pc barring some items
  • Customs duty on ores and concentrates reduced to 2 pc from 5 pc
  • Customs duty on refractories reduced to 7.5 pc
  • Customs duty on 10 anti-AIDS and cancer drugs down to 5 pc
  • Customs duty on life-saving drugs down to 5 pc from 15 pc
  • Rs 300 cr as VAT compensation to states
  • Customes duty on ferrous alloy down to 7.5 pc from 10 pc
  • Peak customs duty reduced from 15 to 12.5 pc
  • Customs duty on naptha reduced to nil
  • Duty on packaging machines reduced to 5 pc
  • Duty on major bulk plastics down from 10 to 5 pc
  • 4 pc CVD on all imports
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  • Countervailing duty on most imports
  • Excise duty on small cars reduced to 16 pc
  • Duty on aerated drinks cut to 16 pc
  • Duty on footwear priced between Rs 250 and Rs 750 down from 16 pc to 8 pc
  • Duty on printing paper reduced to 12 pc
  • Import duty on manmade fibre cut from 15 pc to 10 pc
  • Customs duty on packaging machines reduced from 15pc to 5 pc
  • 8 pc excise duty on packaged software
  • Excise duty on compact fluorescent lamps cut from 16 pc to 8 pc
  • Nil customs duty on set-top boxes
  • Duty on instant food cut to 8 pc
  • Cess on domestically-produced petroleum crude raised from Rs 1800/t to Rs 2500/t
  • Entire amount to be absorbed by oil producing companies
  • Excise duty on cigarettes increased by five per cent
  • Many tax exemptions in customs and excise to be removed barring SSI
  • No change in rates of personal or corporate income taxes
  • No new taxes are being imposed
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  • One-by-six scheme for filing of income tax returns abolished
  • Excise duty on cigarettes up 5 pc
  • MAT rate inc from 7.5 pc to 10 pc
  • April 1, 2010 date for introduction of GST
  • Service tax raised to 12 pc
  • Bank Fds upto 5 yrs is included in 80-C reduction
  • Samll cars ice cream get cheaper
  • Rs 10,000 tax exemption limit for pension funds
  • FDs in scheduled commercial banks with five year maturity will get tax exemption under Section 80C
  • Rs 10,000 exemption limit for investment in pension funds under Section 80CCC removed
  • These investments would be brought under Sec 80C subject to a ceiling of Rs 1 lakh
  • Minimum alternate tax
  • Banking cash transcation tax to continue
  • Customs duty on vanaspati raised to 8 pc
  • Constituency allowances of MLAs to be treated for income tax purposes
  • Constituency allowances of MPs to be treated for income tax purposes
  • More transactions to come under PAN
  • Banking cash transaction tax introduced last year will continue
  • Fringe Benefit Tax modified
  • Threshhold limits of FBT raised
  • FBT will remain as it is
  • FBT is justified for ensuring horizontal equity
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