Poor Monsoon – affected Rabi and Kharif crops
India weathered the crisis well
Supporting and delivering services and not giving directly to the citizens
2009-10 – Challenging year attributed to 2008-09 Q3, Q4
GDP
FY 2008-09 – GDP 6.7 % Substantial fiscal expansion
Q1 2009-10 – GDP 6.1%
Q2 2009-10 – GDP 7.9%
Q3 & Q4 – expected higher than 7.2%
Hope to reach 10% GDP shortly
Negative growth in agriculture
Renewed growth in Manufacturing – Dec 2009 – 18% (highest in past 2 decades)
Since Dec 2009 – food prices transmitted to other non food items
Budget to reflect Govt’s vision for development
Ensure better management of Food security
Move towards Fiscal consolidation
Make growth more broad based and ensure demand supply are better managed and matched
Need to review the public spending, mobilize resources
Exit strategy from Expansionary fiscal stance in past 2 years

Fiscal consolidation
Explicit reduction in Domestic Public Debt FM to come out with a report
To introduce Simple Tax system which includes Voluntary compliance
Direct Tax Code (DTC) – To be in a position to implement DTC from 1-April 2011
GST – To finalize the structure of GST and implement by 1-April-2011
Disinvestment program – PSU
Oil India, NHPC, NTPC, Rural Electrification Corp; NMDC, SVJN
Raise Rs 25000 Cr in FY 2010
Proceed to utilize Capex for social sector for creating new assets
Unlock value for all stakeholders
Adhered to fiscal roadmap

Simplify FDI regime
Defined indirect investment by foreign companies in Indian Companies
Automatic route – Payment for Royalties etc
Clarity and predictability for FDI policy

Banks
To extend geographic coverage of Banks
RBI considering additional banking licensing to Pvt Sectors and NBFC (if meet RBI eligibility criteria)
Rs 1900 Cr as Tier I capital in 4 Pub Banks infused
Rs 16500 Cr infused to maintain min 8% Tier I Capital Ratio in Public sector banks
Increase lending to rural economy
Interest subvention of 2% preshipment export credit – extended to 1 more year (handicraft, handloom, carpet and SMEs)

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