Union Budget 2012-13 Facts & Highlights

Union Budget 2012-13
Finance Minister Pranab Mukherjee presented the Budget 2012-13 in Parliament on Wednesday, March 16 2012.

Budget 2012-13 - An Analysis 

Highlights of Pranab Mukherjee's Union Budget 2012-13 Speech

  • Allow external commercial borrowing of up to $1 bln to raise working capital for airlines industry for 1 year
  • To allow qualified foreign investors in Indian corporate debt markets
  • To allow external commercial borrowing to part finance rupee debt in power projects
  • Proposes to remove sector-specific restriction on venture capital fund investments
  • Hope to achieve "broad-based consensus" to open multi-brand retail sector to foreign investors
  • To award contracts to build 8,800 km of roads in 2012/13
  • Govt to provide 600 billion rupees in tax free bonds for financing infrastructure projects in 2012/13
  • We have to accelerate the pace of reform, says Pranab
  • Expect headline inflation to moderate in next few months and remain stable thereafter
  • Economy expected to grow at 7.6 percent in 2012/13, plus or minus 0.25 percent
  • Economy expected to grow at 6.9 percent in 2011/12
  • Signs of economy turning around in March quarter
  • Expects country to become self-sufficient in urea production in five years
  • Proposes to raise agricultural credit target in 2012/13 to 5.75 trillion rupees
  • Disinvestment target in 2012-13 of 300 billion rupees
  • Expects country to become self-sufficient in urea production in five years
  • Proposes to raise agricultural credit target in 2012/13 to 5.75 trillion rupees
  • To keep 2012/13 subsidies under 2 percent of GDP
  • Major subsidies bill estimated at 1.8 trillion rupees in 2012-13
  • Food subsidy bill in 2012-13 seen at 750 billion rupees
  • Fertilizer subsidy bill in 2012-13 seen at 609.7 billion rupees
  • Petroleum subsidy bill in 2012-13 seen at 435.8 billion rupees
  • Revised petroleum subsidy bill for 2011-12 at 684.8 billion rupees
  • To inject 159 billion rupees to capitalize state-run banks in 2012/13
  • Current account deficit seen at 3.6 per cent of GDP in 2011-12
  • Allocates 1.94 trillion rupees for defence in 2012/13, up from 1.64 trillion rupees in previous year
  • Fiscal deficit seen at 5 . 9 percent of GDP in 2011-12
  • Fiscal deficit seen at 5 . 1 percent of GDP in 2012-13
  • Total expenditure in 2012 / 13 seen at 14 . 9 trillion rupees
  • Plan expenditure budgeted at 521.25 billion rupees in 2012/13, up 18 percent
  • Gross tax receipts seen at 10.8 trillion rupees in 2012-13
  • Non-tax revenue seen at 1.64 trillion rupees in 2012-13
  • Proposes to levy tax on all services except 17 items in the negative list from 2012/13
  • Proposes to raise service tax rate to 12 percent from 10 percent
  • No change in corporate tax rates
  • To enhance tax exemption limit to 200,000 rupees for individuals income in 2012/13
  • Proposes to provide full exemption on import duty of thermal coal for power plants
  • Proposes to double basic customs duty on gold
  • Net market borrowing seen at 4.8 trillion rupees in 2012-13
  • AC, gold jewelery, refrigerator, telephone bills, SUVs and cigarettes 
  • Cinema and films, LCDs and LEDs, bicycles, housing society charges, LPG, mobile phones, medicines for treating cancer and HIV
  • "We have to accelerate the pace of reforms and improve supply side management of the economy."
  • "Economic policy, as medical treatment, often requires us to do something which in the short run may be painful but is good for us in the long run."
  • "As Hamlet, the Prince of Denmark, said in Shakespeare's immortal words, 'I must be cruel only to be kind'." 
Highlights & Facts from Earlier Indian budgets which impacted the Indian economic history 
  • February 28, 1970: Indira Gandhi presented the Budget against the backdrop of bank nationalisation that began in the previous year.
  • February 28, 1982: Pranab Mukherjee presented the Budget after India signed an agreement with IMF for a $ 5 billion loan.
  • March 16, 1985: VP Singh presented the Budget on the heels of an improvement in the economy. India had voluntarily terminated its agreement with IMF in May, 1984.
  • July 24, 1991: Manmohan Singh presented the Budget in the wake of a balance of payments crisis and double digit inflation.
  • February 28, 1997: P Chidambaram presented the Budget after an average growth of 7 per cent for three years. It was called the 'Dream Budget' and many widely accepted it as the best budget.
  • February 27, 1999: Yashwant Sinha presented the Budget amid the fallout of the Asian financial crisis and economic sanctions on India for conducting nuclear tests.
  • February 28, 2005: P Chidambaram presented the Budget soon after the economy began its highest ever growth phase.
More Earlier Budgets' Facts & Highlights:
  • Morarji Desai has presented the maximum number of budgets: 10 times
  • Jawaharlal Nehru, Indira Gandhi and Rajiv Gandhi  are the Prime Ministers to have presented a Budget
  • Indira Gandhi has been the only woman finance minister of India so far
  • HM Patel in 1977 gave the shortest ever interim budget speech. His speech was 800 words long.
  • Manmohan Singh as Finance Minister introduced the concept of service tax
  • Jaswant Singh held the Finance Minister's portfolio for the shortest period of time. He was the finance minister only for 13 days.
  • R Venkataraman has been the only Finance Minister to have risen to be the President of India
  • Shankar Acharya was the Chief Economic Advisor for the maximum number of budgets - seven Union Budgets and two Interim Budgets.