Budget promises reforms, growth-focus, inflation-check
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New Delhi: With a fair dose of reforms in the form of direct kerosene and fertiliser subsidies to users, Finance Minister Pranab Mukherjee on Monday presented the federal budget for 2011-12, promising to check inflation and corruption and push growth.
Stating that India had bounced back after the global financial crisis with broadbased growth, he said inflation remained a matter of concern, especially in food prices, though it had dipped from over 20 per cent to around 7 per cent now.
The finance minister also said more allocations were being made during this fiscal for areas such as agriculture and education, in a bid to reap the demographic dividend that is already seeing India having the largest working population in the world.
This apart, he said the foreign direct investment policy was being revamped, which may result in the entry of multinational firms in the country's $300 billion retail trade industry, apart from liberalising the norms governing pension and insurance funds.
"We are reaching an end to a remarkable year with high growth and many challenges. Our growth in 2010-11 has been swift and broad-based. Economy is back to pre-crisis growth trajectory," Mukherjee said in his opening remarks.
"In the medium term, our three priorities of maintaining high growth trajectory, making development more inclusive and improving our institutions remain relevant," the minister added.
This is the sixth such exercise for the 75-year-old politician. He tabled three budgets between 1982 and 1984. The one unveiled on Monday was the third successive one for the United Progressive Alliance (UPA) government.
Expectations were high from both households and the corporate sector as this budget is being presented against the backdrop of high inflation, fluctuating industrial growth, erratic exports and a general perception that the reform process has retarded.
"I do not foresee resources being a major constraint, at least in the medium term," Mukherjee said, referring to the money needed to address the larger agenda of growth, social programmes and infrastructure development.
He said the farm sector had shown a rebound with 5.4 per cent growth, industry was regaining its earlier momentum and services continued to grow at double digits. He added that fiscal consolidation too was impressive.
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