Chidambaram's Budget 2008-09 aims at Farmers, Women and Minorities

As expected, Finance Minister P Chidambaram focused on people that can be easily wooed as vote banks. Farmers, Women, SCs, STs, OBCs and Minorities get bumper packages. The focus of this budget is clearly on rural and social sector and the FM has maintained a good balance to woo the above people ahead of possible general elections within a few months. The FM later announced tax measures and duty reductions that will benefit the middle class people. Here are the highlights of Union Budget 2008:

Vision and Growth:

Total Plan expenditure fixed at Rs 2,43,000 crore and non-plan expenditure at 5,74,000 crore.
Growth rate has gone over 8 percent
It will be maintained at 8.8 per cent in the next fiscal
India has become self-sufficient in food grain productions
2008-09 will be a year for consolidation of government policies
Adequate steps to be taken to keep the inflation rate under check

Fiscal Deficit 3.1 per cent of GDP

Revenue Deficit 1.4 per cent of GDP

Soyabean output to be 9.45 mn tonnes

Maize production to be 16.78 mn tonne

Rice production to be 94.08 mn tonnes

Total agri production to be 219.32 mn tonnes at all time high

Education:

Funding for Education sector will be up by 20 percent
Allocation for education sector - raised to 34,400 cr
Mid-day Meal schemes will be extended to upper-primary schools (2.5 cr children)
Three new IITs will be set up in Andhra Pradesh, Bihar and Rajasthan
16 Central Universities will be set up across the country - one in each state
Age limit for science scholarship raised

Rs 750 crore for upgradation of 300 ITIs in 25 districts

22 Sainik schools get Rs 44 crore

Bhopal and Tripura to get one IIScR each and 2 colleges of art

Health and Development:

Services sector is expected to grow by 10.8 per cent
Rs. 31,280 cr for Bharat Nirman Yojana
All knowledge institutions will be integrated
Rs. 85 crore for Knowledge Society in 2008
Health spending to increase by 15 per cent - allocation to be raised to Rs, 16,534 crore
Total allocation for NRHM (National Rural Health Mission) to be at Rs. 12,050 crore
National Program of elderly worth plan outlays of Rs 400 cr
Health Insurance of Rs. 30,000 for all BPL families
Remuneration of Anganwadi Workers to be raised at Rs. 1500 per month
Rs. 750 crore to be given to 1 lakh Scholarship
Rs. 70, 200 crore to be spent on drinking water mission
Rs. 1,200 crore for sanitation programmes
Rs. 7,300 crore for Rajiv Gandhi Water Mission
Rs. 6,870 crore for Urban Development programmes
Rs. 992 crore for AIDS related programmes
NREG Scheme rolled out for 596 rural districts
Rs. 500 crore fund for development in the North-east

Rs. 16,436 crore as equity support to public sector enterprises
Govt. to provide Rs 303 crore as debt support to PSUs
Rs. 12,970 crore allocated for National Highways
Commercial banks to have 250 rural accounts every year
Rs. 5000 crore fund for enhancing re-finance operations
Govt to tap into resources of SCBs to set up funds
Rs 32,667 crore for food subsidies under PDS scheme
Govt to create national fund for power transmission and distribution
Defence allocation raised to Rs 1,05, 600 crore
Defence spending to increase by 10 per cent
Rs. 624 crore to be allocated for Commonwealth Games
The 6th Pay Commission will meet Employee expectations

Special Tiger Protection Force will be formed

Sixth Pay Commision Report to be produced before March 31, 2008

Haryana and Chandigarh to introduce smart card based delivery system under PDS

Rs 8000 cr plan for faster power reforms

NHDP allocation up from Rs 10,866 cr to Rs 12,966 cr

FDI in Apr-Dec at $12.7 billion, FII inflow over $18 billion

Tea Research association gets Rs 20 cr

Rs 200 cr for providing portable water system in each school in areas of water scarce regions

Rs 50 cr for Tiger Conservation

Sops for Women, SCs, STs, OBCs and Minorities:

Rs. 3,996 crore for SCs, STs and OBCs
Rs. 804 crore SC Development programmes
Rs. 195 crore for ST Development Project
More schools will be opened for SCs and STs in 20 more districts
Rs. 11,460 crore for projects related to women
Rs. 33,434 crore for projects related to children
Rs. 45 crore for the modernization of Madarassas
288 branches of govt. bank to be opened in minority dominated areas
Rs. 13,100 crore for Sarba Siksha Abhiyan
Women and Self-Employed will get loans from LIC

Rs. 80 crore for development of Girls' Hostels

More minority people will be recruited in para-military forces
Rs. 650 crore for 6000 model schools across the country
Rs. 16,202 cr projects will have 30% women representations
Allocation to Ministry of Minority Affairs raised to Rs. 1000 crore

Jawaharlal Navoday Vidyalaya to be set in 20 new districts for SC/STs

54 gender budgeting cells set up

LIC to cover all woman SHGs linked to the bank

Bonanza for Farmers:

Agriculture Credit Disbursal target - 2,80,000 crore
Govt. to set up irrigation and water resource corporations
Rs. 75 crore will be spent for mobile soil-testing labs in 260 districts
Scheme of debt waiver and debt relief for farmers
All loans disbursed up to March 2007, have been waived
Waiver of all loans to marginal farmers holding lands up to 1 hectare
Loan Waiver for small farmers holding lands up to 1-2 hectares
One-time settlement scheme of all bank loans for farmers
Rescheduled agricultural loans will be eligible for loan waiver
Waiver amounts 4 per cent of total bank loans
Debt waiver to be implemented by June 30, 2008
All loans issued by SCBs, Rural Bamks and Co-operative banks are waived
In total, 4 crore farmers will benefit from the scheme

Total amount of loan waivers will be around Rs. 60,000 crore

Rs 340 cr insurance scheme to cover 17 lakh farmers and weavers

All 30 integrated textile parks approved

Duties:

Excise Duty cut from 16% to 14 %
Small Cars like Nano and Maruti 800 to be cheaper
Customs Duty on Crude cut from 5% to 2%
Ad Valorem duty on diesel, petrol removed
Cigarettes will be costlier
Anti-AIDS drugs will be cheaper
Duty on two-wheelers and three-wheelers reduced to 12% from 16%

Customs Duty on Project Imports cut by 2%

Customs duty on specified sports goods machinery down from 7.5 per cent to five per cent

Sports Goods to be cheaper

Set Top Box, Dairy Products, ACs and Washing Machines to be cheaper

Mobile Phones, Cement, Packed Software to be costlier

Shampoos, Oil, Tea, Coffeee, Coconut, Paper will be cheaper

With a 5% duty cut, life-saving drugs will be cheaper

IT Products will be cheaper

No excise duty on refrigerating equipments

Excise duty on hybrid cars cut from 24 per cent to 14 per cent

Excise on small cars cut to 12 per cent from 16 per cent

Custom duty on vitamin pre-mixes to lower from 30% to 20%

Duty withdrawn on naptha for production of polymers.25

Duty on crude and unrefined sulphur reduced from five to 2 per cent to help raise domestic fertiliser production

Duty withdrawn on naptha for production of polymers

General Cenvat on all goods to be reduced from 16 per cent to 14 per cent

Excise duty reduced from 16 per cent to eight per cent on all pharmaceutical goods

Import duty on Luxury Cars increased to 180 per cent

Excise duty reduced from 16 to 8 per cent on water purification items

Taxes:

Income Tax Exemptions limit for men raised Rs. 1.5 lakh
Income Tax Exemptions limit for women raised Rs. 1.8 lakh
Income Tax Exemptions limit for Senior Citizens raised to Rs. 2.25 lakh
No change in Corporate Tax
Four new sectors brought under service tax net
Earnings from Rs. 1.5 lakh to Rs. 3 lakh per annum- 10% income tax
Earning from Rs. 3 lakh to Rs. 5 lakh per annum - 20% income tax
Earnings above Rs. 5 lakh - 30% income tax

Tax exemptions up to Rs. 15,000 will be given on health policies to be spent on dependent parents
5-year tax breaks for UNESCO Sites, 2,3 and 4 star hotels
5-year Tax Holidays for Hospitals across the Country
Banking Cash Transaction tax to be withdrawn from April 2009
Fresh facilities, encouragement to sports and guest houses exempted from Fringe Benefit Tax.

No changes in Security Exchange rates
Short Term Capital Gain Tax to be increased from 10% to 15 %

General Sales Tax, reduced from 3% to 2%.

PAN requirement to be extended to all transactions in capital market subject to a threshold

Direct tax proposals to be revenue neutral. Indirect tax proposals to result in loss of Rs 5,000 crore.

Asset management service under mutual funds, services by stock exchanges to be brought under Service Tax net