Karela Fry

Just another WordPress.com weblog

Union budget 2011-2012

with 5 comments

Pranab Mukherjee
The union budget for 2011-12 is now available. The total expense budgeted for is INR 12,57,729 crores. It is up by 3.4% over last year’s budget. The total reciepts are expected to be INR 12,57,728 crores. The highlights of the expenses are:

  1. Interest payment is 21% of the total budget. Last year it was 19%. A further 8% of the budget goes towards debt repayment. Debt servicing therefore takes up 29% of the budget.
  2. Defense gets 13% of the budget, compared to 12% last year (the allocation is therefore 8% larger this year). 58% of this (INR 95, 216 crores) is revenue expense, which is largely salary related.
  3. Total plan expense is INR 4,41,547 crores, ie, 35% of the budget. This is up from 20% of the budget last year. The highlights of the plan budget are:
    • Health gets INR 26,760 crores in the budget. This is 2.1% of the budget, and is a marginal increase over the previous year as a fraction of the budget. Of this outlay, INR 1,700 crores is earmarked for AIDS control.
    • Education expense is budgeted to be INR 520,60 crores. This is 4% of the budget, compared to 3.6% last year.
    • Science and Technology gets INR 5,679 crores , space gets INR 5,700 crores, atomic energy gets INR 10,012 crores. These together are 1.7% of the budget.
    • Railways gets INR 56,589 crores, ie, 4.5% of the budget.

The reason that this is being called a populist budget is that 31% of the budget will be financed by borrowings. Only about 74% of the receipts are from taxes (28.6% comes from corporate taxes and 13.7% from income tax). Corporate taxes have jumped a bit from last year, but revenue from income tax was only 9% of last year’s budget, so that is a large increase. Certainly not a populist budget by ordinary people’s standards.

The report on last year’s union budget can still be found here.

A very interesting sidelight is reported by Moneycontrol:

In his Budget announcement the Finance Minister said “The electronic filing of Tax Deduction at Source (TDS) statement has stabilized. The Board shall soon notify a category of salaried taxpayers who will not be required to file a return of income as their tax liability has been discharged by their employer through deduction at source.”

Advertisements

5 Responses

Subscribe to comments with RSS.

  1. […] this rate the loss in one year will be INR 7,665 crores, which far exceeds this year’s science and technology budget of INR 5,679 crores. The role of the previous aviation minister, Praful Patel, becomes highly questionable given that: […]

  2. […] government has been budgeting a deficit for years: debt servicing took away 29% of the union budget this year and 31% of the incoming were expected to be borrowings. This will certainly not be possible if the […]

  3. […] and need to be understood. It is a simple matter to gather facts about the second issue. In the union budget of 2011-12, 13% of the allocation went to defence. This is about INR 1,63,505 crores. For comparison, recall […]

  4. […] union budget of 2011-12 can be viewed here. Share this:TwitterLike this:LikeBe the first to like this […]

  5. […] Mukherjee did show the same concern during his tenure as finance minister: the budgets of 2010, 2011, 2012 did show year-by-year increase in rupees. As a fraction of the annual budget, it has remained […]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: