Finance Budget 2011 Highlights

The Union Budget 2011-12, presented by the then Finance Minister Pranab Mukherjee, aimed to consolidate economic growth while addressing inflationary pressures and promoting inclusive development. The budget focused on infrastructure development, agriculture, education, and healthcare, with a strong emphasis on fiscal consolidation.

Key Priorities and Allocations:

• Fiscal Consolidation: A major goal was to reduce the fiscal deficit. The budget targeted a reduction in the fiscal deficit to 4.6% of GDP by 2011-12. This was to be achieved through a combination of revenue enhancement and expenditure rationalization.
• Infrastructure: The budget placed significant emphasis on infrastructure development, recognizing its importance for sustained economic growth. Increased allocations were made to sectors like roads, railways, ports, and power. A target of investing over ₹214,000 crore in infrastructure during the year was set.
• Agriculture: Recognizing the importance of the agricultural sector, the budget proposed measures to boost agricultural production and improve farmers’ incomes. Allocations for agricultural research and development were increased. The credit flow to farmers was enhanced to ₹475,000 crore.
• Education: The budget emphasized improving access to and quality of education. Allocations for Sarva Shiksha Abhiyan (SSA) and the Mid-Day Meal scheme were increased. A National Mission on Education through Information and Communication Technology was given further impetus.
• Healthcare: The budget addressed healthcare challenges by increasing allocations to the National Rural Health Mission (NRHM). Focus was placed on improving healthcare infrastructure and expanding access to healthcare services, particularly in rural areas.

Taxation Proposals:

• Direct Taxes: The budget proposed changes to income tax slabs to provide relief to taxpayers. While the basic exemption limit remained unchanged, the income tax slabs were adjusted to benefit individuals in lower and middle-income groups.
• Indirect Taxes: Modest increases were made to excise duties on certain items. The service tax rate remained unchanged.
• Corporate Tax: The corporate tax rate remained unchanged.

Other Notable Measures:

• Social Sector Schemes: The budget continued to support various social sector schemes aimed at poverty reduction and social inclusion, including the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and the Indira Awas Yojana (IAY).
• Financial Sector Reforms: The budget outlined plans for further reforms in the financial sector, including strengthening the regulatory framework and promoting financial inclusion.
• Investment Promotion: Measures were announced to attract both domestic and foreign investment, including streamlining investment procedures and promoting public-private partnerships (PPPs).

In conclusion, the Finance Budget 2011-12 was a balanced budget that aimed to promote economic growth, address inflationary pressures, and ensure inclusive development. While focusing on fiscal consolidation, it also prioritized crucial sectors like infrastructure, agriculture, education, and healthcare, recognizing their vital role in India’s long-term economic prosperity.