Highlights of the 2008 budget speech by financial minister P Chidambaram. (Via email from Febin S A).

• Hikes tax-free income from Rs 1,10,000 to Rs 1,50,000
• 10% tax on income from Rs 1,50,000 to Rs 3,00,000
• 20% tax on income from Rs 3,00,000 to Rs 5,00,000
• 30% tax on income over Rs 5,00,000
• Women exemption increases from Rs 1,45,000 to Rs 1,80,000
• Senior citizen exemption increases from Rs 1,95,000 to Rs 2,25,000
• Banking cash transaction tax to be removed
• STT applicable on commodities trading
• Tax on short term capital gains increased to 15% from 10%
• Debt Waiver: Total estimate Rs 60,000cr; Overdue loans to be waived will be Rs 50,000 crore; One-time settlement estimated at Rs 10,000 crore; all agri loans by RRBs, co-operatives, SCBs overdue taken before March 2007 and outstanding on December 2007 are covered. Loans waived for marginal farmers holding up to 1 hectare and small farmers up to 2 hectare
• Service tax limited hiked to Rs 10 lakh.
• Excise on two-wheelers reduced from 16% to 12%
• Reduced general CENVAT from 16% to 14%
• Duties on iron ore exports increased to Rs 3,000/tn
• Project import customs duty reduced from 7.5% to 5%; Steel melting scrap and aluminium scrap made nil; Life saving drugs customs duty from 10% to 5%;
• No change in peak rate of customs duty;
• Revenue deficit at 1.4% against budget estimate of 1.5%; To eliminate revenue deficit in FY10; Fiscal deficit at 3.1% against budget estimate of 3.3%; Plan expenditure Rs 2,43,386 crore;
• Defence allocation increased from Rs 96,000cr to Rs 1,05,600 crore; Food subsidies at Rs 32,667 crore;
• Exchange-traded currencies; interest rate derivatives to be introduced;
• TUF to increase to Rs 1,090 crore; Rural Infrastructure Development Fund increased to Rs 14,000 crore;
• Saving rate at 35.6%, investment rate at 36.3 %;
• Rs 1,000cr to be placed with LIC for covering an additional 1cr landless households; PAN to be extended for all transactions in financial markets, subject to suitable threshold;
• Coal regulator to be set up; GQ completed 96.48%, National fund for transmission and distribution;
• To continue with fertiliser subsidies, may move to nutrient-based subsidies; Rs 20,000 crore allocated for irrigation; Agricultural credit at Rs 2,80,000 crore; To mobilse Rs 10,000cr for plan capital expenditure;
• Rs 16,202cr scheme that will cover at least 33% women;
• Chennai desalination plant to get Rs 300cr in 08-09;
• JNURM to get Rs 6,866cr in 2008-09 from Rs 5,482cr in 07-08;
• Anganwadi workers remuneration to be increased to Rs 1,500 per month.
• Rs 30,000 cover for unorganised sector; Centre to share Rs 200cr premium; Health allocation increased by 15%
• Govt to interconnect all national institutions on a knowledge network; Govt to establish 16 central universities; 3 IITs in Bihar, AP and Rajasthan;
• Mid-day meal scheme extended in government and government aided schools in upper primary classes. Total coverage of 13.9 crore children; Education allocation increased by 20%
• 2008-09 should be a year of consolidation; We can do better to achieve inclusive growth; The government will manage capital inflows along with RBI;
• Total agricultural output 219.32 million tonne. Agriculture growth rate at 2.6% in 2007

(Image courtesy: The Hindu)