The General Budget for 2006-07 presented by the Finance Minister, Shri P. Chidambaram was well-received in the Indian press and the business community. It’s a Good Feel and prove beneficial budget as well. Its to be seen that FM does not ignore issues in public expenditure efficiency, out of Poor Budget management or political reasons.
The budget includes a number of initiatives that will help spur economic growth and provide justice to the disadvantaged sections of the society. The bulk of the budgetary resources will go for UPA government’s eight flagship programmes – Sarva Siksha Abhiyan, Mid Day Meal Scheme, Rajiv Gandhi Drinking Water Mission, Total Sanitation Campaign, National Rural Health Mission, Integrated Child Development Services, National Rural Employment Guarantee Scheme and Jawaharlal Nehru National Urban Renewal Mission. The total allocation for these programs at Rs.50,015 crores will be 43.2% more (in nominal terms) compared to the last year's allocation of Rs.34,927 crores.
Continuing the emphasis on tax reforms, the Finance Minister has proposed rationalization of some of the indirect taxes while expanding service tax net, given that this sector now contributes about 54 per cent of GDP. As a step in the direction of a progressive convergence of the service tax rate and the CENVAT rate, the Finance Minister has proposed to increase the service tax rate from 10 per cent to 12 per cent. The net impact of this increase is, however, likely to be very small. The Finance Minister has set April 1, 2010 as the date for introducing national level Goods and Service Tax (GST).
The Finance Minister noted that while the world has recognized the potential of India. “It is now for us to rediscover the greatness of this country and the potential of its people. The young people of India are building castles, it may appear that those castles are in the air...it is our duty to put the foundations on which the young can build their castles.” So, here's a hope somewhere...
When we consider the emphasis given to the agriculture, agro-processing, rural development, education, industry,women empowerment,health care,research etc.etc.and reduction of excise and custom duties for competency, the budget is best but the NRIs are disappointed. Non Residents you call....(Not non reliable indians!) NRIs were getting 40% preferential allotment in Initial Public Offering of the Indian companies. That was excellent opportunity for NRI retail investors to invest Indian capital market.Government had withdrawn that facility and offered that segment to foreign institutional investors.
I also find that government had declared an insurance scheme for NRIs workers, the details are not published and the implementation is still pending...That remains to be seen how soon its introduced...