Union Budget 2012-13: A summary

Pranab Mukherjee

The Union Budget 2012-13 presented by the Finance Minister Pranab Mukherjee in Lok Sabha today identified five objectives to be addressed effectively in the ensuing fiscal year.

They include focus on domestic demand driven growth recovery; create conditions for rapid revival of high growth in private investment; address supply bottlenecks in agriculture, energy and transport sectors particularly in coal, power, national highways, railways and civil aviation; intervene decisively to address the problem of malnutrition especially in the 200 high-burden districts and expedite coordinated implementation of decisions being taken to improve delivery systems , governance, and transparency; and address the problem of black money and corruption in public life.

Mukherjee said that India's GDP growth in 2012-13 is expected to be 7.6 per cent +/-0.25 per cent. He said that in 2011-12, India's GDP is estimated to grow at 6.9 per cent after having grown at the rate of 8.4 per cent in each of the two preceding years He said though the global crisis had affected India, it still remains among the front runners in economic growth. Mukherjee said the slowdown is primarily due to deceleration in industrial growth. Stating that the headline inflation remained high for most part of the year, the Finance Minister expressed hope that it will moderate further in the next few months and remain stable thereafter.

FM laid emphasis on striking a balance between fiscal consolidation and strengthening macroeconomic fundamentals. He announced introduction of amendments to the Fiscal Responsibility and Budget Management Act, 2003 (FRBM Act) as part of the Finance Bill 2012. He said that concept of "Effective Revenue Deficit" and "Medium Term Expenditure Framework" statement are two important features of Amendment to FRBM Act in the direction of expenditure reforms. This statement shall set forth a three year rolling targets for expenditure indicatoRs

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