BUDGET & THE ECONOMY: Nuts & Bolts

ITIs to be upgraded
Public-private partnership is to be the model for upgrading 1,396 ITIs into centres of excellence in specific trades and skills.

The Centre wants the cooperation of state governments in upgrading at least 300 ITIs every year, beginning 2007-08, and Rs 750 crore has been kept aside for this. The Central Government will provide financial assistance by way of seed money.

Ambitious targets for drinking water and sanitation on the anvil
About 55,512 habitations and 34,000 schools have been provided drinking water supply till December, 2006 under the Rajiv Gandhi Drinking Water Mission.

Now, more ambitious targets have been set for 2007-08 -the allocation for the mission is being hiked from Rs 4,680 crore in 2006-07 to Rs 5,850 crore in 2007-08.

As regards the Total Sanitation Campaign, the proposal is to increase the provision from Rs 720 crore to Rs 954 crore next year.

A package to control growing HIV/AIDS cases
HIV/AIDS will be deemed 'stabilised' if the prevalence rate is less than one per cent of the population.

To achieve this objective the National Aids Control Programme (NACP)-III, starting in 2007-08 and building on NACP-I and NACP-II, will target high-risk groups in all the States.

Access to condoms will be expanded and universal access to blood screening and safe blood will be ensured. More hospitals will provide treatment to prevent transmission of HIV/AIDS from mother to child.

Support will be given to the protocol on pediatric dosage developed by Indian doctors and launched in November 2006. For the year 2007-08, the outlay for the AIDS control programme has been upped to Rs 969 crore. 
 

CARELESS TAXMAN Huge arrears lying not collected                   Rs crore
	Under   dispute	Not under dispute
Corporate Tax	28,378	9,626
Income Tax	31,549	5,921
Customs	2,443	810
Excise	7,600	3,413
Service Tax	409	105
Total	70,379	19,875

Ensuring that the Polio menace is eradicated
Despite the goal of eliminating polio from the country by December 2007, there was an outbreak in western Uttar Pradesh in early 2006.

As a result the strategy for polio eradication has been revised. The number of polio rounds will be increased, monovalent vaccine will be introduced, and there will be intensive coverage in the 20 high-risk districts of Uttar Pradesh and 10 districts of Bihar. The programme has been integrated into the NRHM.

The ASHAs and the Anganwadi workers will visit every household and track every child for the immunisation programme. To achieve the goal of eliminating polio, an outlay of Rs 1, 290 crore in 2007-08 has been proposed.

ICDS to be expanded
In the second phase of expansion of the Integrated Child Development Services (ICDS), the government has sanctioned 173 ICDS projects, 107,274 Anganwadi centres and 25,961 mini-Anganwadi centres.

The scheme is being enlarged, with the allocation for ICDS going up from Rs 4,087 crore in 2006-07 to Rs 4,761 crore in 2007-08.

Giving a fillip to urban renewal
The Jawaharlal Nehru National Urban Renewal Mission (JNNURM) has evoked a positive response from State Governments.

As on date, 538 projects with a total cost of Rs 23,950 crore have been sanctioned in sectors such as water supply, sanitation, transport, road and housing in many cities spread over several states. In order to give a fillip to the mission, the allocation is being enhanced from Rs 4, 595 crore in 2006-07 to Rs 4, 987 crore in 2007-08.

Textile Parks to get more
The provision for Integrated Textile Parks is to be increased from Rs 189 crore in 2006-07 to Rs 425 crore in 2007-08, in order to prepare the textile industry to meet global challenges.

Twenty-six parks have been approved so far out of 30 sanctioned under the Scheme for Integrated Textiles Parks (SITP). The Technology Upgradation Fund (TUF) scheme will be continued during the Eleventh Plan, with the the provision for it to be stepped up from Rs 535 crore in 2006-07 to Rs 911 crore in 2007-08.

Modernising the PDS system
The issue prices of food grains under the Public Distribution System (PDS) and for the beneficiaries of the Antyodaya Anna Yojana have been retained.

However, a new plan has been mooted for evaluation, monitoring, management and strengthening of the targeted PDS, which will be implemented in 2007-08.

The plan includes computerisation of the Public Distribution System and an integrated information system in the state-owned Food Corporation of India.

Sops for Scheduled Castes and Scheduled Tribes
The allocation in 2007-08 for Scheduled Castes and Scheduled Tribes has been substantially enhanced.

For schemes benefiting only SCs and STs, the allocation has been increased to Rs 3, 271 crore. For schemes with at least 20 per cent of the benefits earmarked for SCs and STs, the allocation has been increased to Rs 17,691 crore.

SC and ST students studying in M.Phil and PhD courses are supported by the Rajiv Gandhi National Fellowship Programme. The allocation for them is being enhanced from Rs 35 crore in 2006-07 to Rs 88 crore in 2007-08.

The allocation for post-matric scholarship schemes is also being hiked from Rs 440 crore in 2006-07 to Rs 611 crore in 2007-08. As a sop to socially and backward classes, a separate provision of Rs 91 crore for similar scholarships to be awarded to students has also been made.

Taking care of minorities
Last year, the Government made a modest contribution of Rs 16.47 crore to the equity of the National Minorities Development and Finance Corporation (NMDFC).

Following the Sachar Committee report, NMDFC would be required to expand its reach and intensify its efforts. Hence, the finance minister has proposed to provide a further sum of Rs 63 crore to the share capital of NMDFC.

Secondly, in a number of districts with a concentration of minorities, the Finance minister has made make a provision of Rs 108 crore for a multi-sector development programmes in these districts.

Thirdly, government is allocating Rs 72 crore for post-matric scholarships, and Rs 90 crore for Merit-cum-Means scholarships at graduate and post-graduate levels.

Backward Regions Grant Fund hiked
The Backward Regions Grant Fund received Rs5,000 crore in 2006-07, and this is being increased to Rs 5,800 crore in 2007-08.

This will finance two components, one pertaining to 250 districts and the other pertaining to a special plan for Bihar.

KBK districts of Orissa, which are included in the 250 districts, will continue to receive the same quantum of assistance as they have been receiving in the past.

New Financial Inclusion Fund to be set up
The government has decided to establish a Financial Inclusion Fund with NABARD for meeting the cost of developmental and promotional interventions aimed at ensuring that vulnerable groups get access to adequate credit and financial services at an affordable cost.

It has also decided to establish a Financial Inclusion Technology Fund to meet the costs of technology adoption. Each fund will have an overall corpus of Rs 500 crore.

Taking women to the forefront
There is growing awareness of gender sensitivities of budgetary allocations. Fifty ministries/departments have set up gender budgeting cells.

For 2007-08, 27 ministries/departments and five Union Territories covering 33 demands for grants contributed to a statement placed in the Budget papers. The outlay for 100 per cent women-specific programmes is Rs 8,795 crore and for schemes where at least 30 per cent is for women-specific programmes is Rs 22,382 crore. 
 

AFFIRMATIVE ACTION Special groups get some attention In                       Rs crore
	2005-06	2006-07	2007-08(BE)
Only for women	8,274	4,618	8,795
Aimed at women*	15,966	17,632	22,382
Only for SC/ST	2,443	2,967	3,271
Aimed at SC/ST**	9,048	12,007	17,691
* programmes where at least 30% funds for women  ** programmes where at least 20% funds for SC/ST

Commonwealth Games bonanza
To make the 2010 Commonwealth Games a success, Rs 150 crore is being allocated for the Ministry of Youth Affairs and Sports in 2007-08, and Rs 350 crore for the Delhi Government.

Similarly, Rs 50 crore is to be allocated for the Commonwealth Youth Games 2008 to be held in Pune.

A date with Gandhiji
On the eve of the 150th year of the First War of Independence and the centenary year of the Satyagraha Movement, Rs 30 crore has been set aside for four institutions associated with Gandhiji: Sabarmati Ashram, Ahmedabad; Sevagram Ashram, Wardha; Bhandarkar Oriental Research Institute, Pune; and Rajendra Smriti Sanghrahalaya, Patna.

Rs 20 crore is to be set aside to reposition the Nehru Memorial Museum and Library in Delhi as a major centre of intellectual activity.

Bringing North East into the mainstream
The total budget allocation in 2007-08 for the North Eastern Region, culled out from allocations under different ministries/ departments, has increased from Rs 12,041 crore in 2006-07 to Rs 14,365 crore in 2007-08.

This includes Rs 1, 380 crore provided to the Ministry of Development of North Eastern Region (DONER). A new industrial policy for the region, with suitable fiscal incentives, will be in place before March 31, 2007.

A mission to boost pulses production
The government is concerned about the stagnation in the production and productivity of pulses, the key to the deficiency being the availability and quality of certified seeds.

To get over this problem the government proposes to expand the Integrated Oilseeds, Oil palm, Pulses and Maize Development programme. There will be a sharper focus on scaling up the production of breeder, foundation and certified seeds.

The Indian Institute of Pulses Research (IIPR), Kanpur, the National and State-level seeds corporations, agricultural universities, Indian Council of Agricultural Research (ICAR) centres, Krishak Bharati Cooperative (KRIBHCO), Indian Farmers Fetiliser Cooperative (IFFCO) and NAFED, as well as large private sector companies, will be invited to submit plans to scale up the production of seeds.

Bringing cheer to the plantation business
The Special Purpose Tea Fund, which had been launched for re-plantation and rejuvenation of tea, has been extended to other products. The Government will soon put in place similar financial mechanisms for coffee, rubber, spices, cashew and coconut.

Funds for managing water resources
The Government proposes to allocate Rs 100 crore to the the National Rainfed Area Authority which was established to coordinate all schemes relating to watershed development and other aspects of land use.

The Tamil Nadu Government has recently signed a loan agreement with the World Bank for Rs 2, 182 crore to restore 5,763 water bodies having a command area of 400,000 hectares.

A similar agreement for Andhra Pradesh is expected to be concluded in March 2007 and will cover 3,000 water bodies with a command area of 250,000 hectares.

Preparation of similar projects for the states of Karnataka, Orissa and West Bengal are at different stages of negotiations with the World Bank and at least two more agreements are likely to be concluded before June.

War against depletion of water resources
With depletion of ground water assuming grave proportions, the Central Ground Water Board has identified 1,065 assessment blocks in the country as 'over-exploited' or 'critical'.

The strategy for ground water recharge is to divert rain water into 'dug wells'. The finance minister proposes to provide 100 per cent subsidy to small and marginal farmers and 50 per cent subsidy to other farmers.

The Ministry of Water Resources will finalise the scheme shortly. In anticipation, the finance minister proposes to transfer a sum of Rs 1,800 crore to NABARD.

New weather-based crop insurance scheme
The Agricultural Insurance Corporation (AIC) has been running a pilot weather insurance scheme since kharif 2004 and it appears to be a more promising risk mitigation scheme.

Hence, the government will ask AIC to start a weather-based crop insurance scheme on a pilot basis in two or three states, in consultation with the state governments concerned.

The scheme will be operated on an actuarial basis with an element of subsidy and an allocation of Rs 100 crore is proposed for this purpose in 2007-08.

Social security for the unorganised sector
Pending a decision on the Arjun Sen Gupta committee report on social security for the unorganised sector, the finance minister proposes to make a beginning by extending death and disability insurance cover through Life Insurance Corporation of India (LIC) to rural landless households under a new scheme called 'Aam Admi Bima Yojana' (AABY).

According to NSS Report No. 491, the estimate of such households is about 1.5 crore. By end March 2007, 70 lakh households will be covered through existing schemes of the LIC with the support of some state governments and the social security fund with the LIC.

Coir industry gets a fillip
A scheme for modernisation and technology upgradation in the coir industry has been introduced with a provision of Rs 22.50 crore.

This will produce coir producing states such as Kerala, Karnataka, Tamil Nadu, Andhra Pradesh and Orissa.

Thumbs up for the handloom sector
The cluster approach to the development of the handloom sector has been expanded, with 100 to 150 more clusters to be brought under this scheme in 2007-08.

The health insurance scheme that has so far covered 300,000 weavers is also to be extended to more weavers.

More funds for e-Governance
The provision for the Centre's e-governance initiative, aimed at improving efficiency, accessibility and transparency in government functions, is being increased from Rs 395 crore in 2006-07 to Rs 719 crore in 2007-08.