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ReturnIndia budget focuses on farming
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admin
PublishDate：
2007-03-01 14:47:00
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NEW DELHI: India stepped up its war on poverty in a budget unveiled yesterday that aimed at boosting stagnant farm output and raising spending on education and health. "The economy is in a stronger position than ever before," Finance Minister P Chidambaram told parliament as he presented the ruling Congress coalition's budget for the fiscal year to March 2008. "I have put these revenues (from growth) to good use to promote inclusive growth, equity and social justice," said Chidambaram whose government has pledged to put the "common man" at the top of its agenda.
But quoting India's first prime minister Jawaharlal Nehru, he said: "The main challenge is agriculture - everything else can wait." He outlined plans to hike farm production and rural incomes and said he was confident the government could wrestle down inflation hovering at two-year highs of 6.6pc.
Both farm output and inflation have become urgent issues with polls looming in India's politically pivotal and most populous state Uttar Pradesh in two months and federal elections at most two years away.
Congress attributed its losses in polls in the breadbasket state of Punjab and northern Uttarankhal on Tuesday partly to voter anger over rising prices which have badly hit India's poor masses who propelled it to power in 2004.
The pro-poor tilt of the budget failed to lift the share market which was already reeling from forecasts of a US slowdown. At mid-afternoon the benchmark Sensex index was down two per cent or 269.97 points at 13,208.60.
"The budget is essentially populist, aimed at catching votes," said Surinder Choudhari, head of auto components maker Krishna Fabrications.
"There's nothing extraordinary in it - and nothing shocking," he said.
Chidambaram announced more spending on irrigation, fertiliser subsidies, seed development and cheaper farm credit along with duty cuts on a host of goods including edible oils to combat inflation.
"There is no death of (agriculture) schemes, no dearth of funds.
What needs to be done is achieve the intended outcome," Chidambaram said.
With over half of the 1.1bn population dependent on the farm sector, low agriculture output has cast a shadow over the "inclusiveness" of India's economic growth which Chidambaram said would meet an earlier estimate of 9.2pc for the full year.
Slow farm growth was cited as a key factor in data released Wednesday showing that Asia's fourth-largest economy grew by a lower-than-expected 8.6pc in the third quarter, down from 9.3pc a year earlier.
Farming is expected to grow just 2.7pc this year, down from six per cent a year earlier. In the third quarter, the farm economy expanded 1.5pc.
That contrasts with manufacturing growth of 11.3 percent which has become the main driver of expansion.
Source:Industry Website
But quoting India's first prime minister Jawaharlal Nehru, he said: "The main challenge is agriculture - everything else can wait." He outlined plans to hike farm production and rural incomes and said he was confident the government could wrestle down inflation hovering at two-year highs of 6.6pc.
Both farm output and inflation have become urgent issues with polls looming in India's politically pivotal and most populous state Uttar Pradesh in two months and federal elections at most two years away.
Congress attributed its losses in polls in the breadbasket state of Punjab and northern Uttarankhal on Tuesday partly to voter anger over rising prices which have badly hit India's poor masses who propelled it to power in 2004.
The pro-poor tilt of the budget failed to lift the share market which was already reeling from forecasts of a US slowdown. At mid-afternoon the benchmark Sensex index was down two per cent or 269.97 points at 13,208.60.
"The budget is essentially populist, aimed at catching votes," said Surinder Choudhari, head of auto components maker Krishna Fabrications.
"There's nothing extraordinary in it - and nothing shocking," he said.
Chidambaram announced more spending on irrigation, fertiliser subsidies, seed development and cheaper farm credit along with duty cuts on a host of goods including edible oils to combat inflation.
"There is no death of (agriculture) schemes, no dearth of funds.
What needs to be done is achieve the intended outcome," Chidambaram said.
With over half of the 1.1bn population dependent on the farm sector, low agriculture output has cast a shadow over the "inclusiveness" of India's economic growth which Chidambaram said would meet an earlier estimate of 9.2pc for the full year.
Slow farm growth was cited as a key factor in data released Wednesday showing that Asia's fourth-largest economy grew by a lower-than-expected 8.6pc in the third quarter, down from 9.3pc a year earlier.
Farming is expected to grow just 2.7pc this year, down from six per cent a year earlier. In the third quarter, the farm economy expanded 1.5pc.
That contrasts with manufacturing growth of 11.3 percent which has become the main driver of expansion.
Source:Industry Website
