The highlights:

28 Feb 2002

1

 

  • Economic growth has slowed down to 5.4 per cent
  • Reform-linked spending, says FM
  • Second generation reform policy being implemented at the state-level
  • Agriculture, food reforms to be emphasised to generate social growth
  • Deregulation of control from agricultural commodities
  • Deregulation of sugar
  • Deregulation of drug control regime
  • Abolition of SICA
  • Expenditure reform commission recommendation considered
  • Future and forward trading of all agricultural commodities
  • Agriculture: diversification and food processing, amendment of milk and milk products control order
  • Announcement of VRS for government employees
  • Countrywide integrated market for agri-products
  • Removal of SSI reservation of agri-equipment
  • Integrated food law to be in place
  • Framers can sell their products directly in the markets
  • Additional allocation of Rs 70 crore to credit linked subsidies scheme
  • Proposal received for 21,00,000-tonne capacity of cold storage as against a target of 12,00,000
  • RIDF enhanced to Rs 5,500 crore, rate of interest decreased from 10.5 per cent to 8 per cent
  • KCC: Rs 2.07 crore issued
  • 1.25 lakh more self-help groups to be in place
  • National Agricultural Insurance Scheme: a new corporation for agricultural insurance to be monitored by public sector insurance companies
  • Research allocation for agriculture raised to Rs 775 crore
  • Allocation of Rs 2,500 crore for Pradhanmantri Gram Sadak Yojna
  • Krishi Vigyan Centre to be certified as nodal agencies for quality controls
  • Agricultural exports to be encouraged
  • New interest subsidy scheme to be introduced with an outlay of Rs 164 crore
  • Jaiprakash Rozgar Yojna launched
  • KBIC and other agencies will be involved in Jaiprakash Rozgar Yojna
  • Rural industrialisation: Mahatma Gandhi Institute for Rural Industrialisation being set up and upgraded to the status of national instituted
  • Assistance to set up rural product marketing centre at district and block level
  • Decentralised procurement not found favour with states
  • Infrastructure – power sector: average rate of return 40 per cent
  • Rs 3,500 crore for power development and reform programme
  • Focus of reforms shifted from generation to transmission and distribution
  • Road Sector: Golden Quadrilateral to be completed substantially by December 2003
  • Major corporatisation of major ports in phased manner
  • International airports in the four metros to be upgraded to world class
  • Package of concession for private parties in greenfield airport projects
  • Urban reforms incentive fund should give a boost to housing and commercial pro-party demand
  • Urban Reform Incentive Fund: initial allocation of Rs 500 crore
  • Rationalisation of high stamp duty regime
  • Rent control, high stamp duty and municipal laws of real estate made more realistic
  • Allocation of issue of municipal tax-free bonds enhanced to Rs 3,000 crore
  • Municipal bond issue thrust could increase business for Crisil
  • Six comprehensive tourism circuits to be identified for development
  • 50 per cent increase in plan outlay for tourism to Rs 225 crore
  • Infra Equity Fund of Rs 1,000 crore to be set up
  • Mechanism to coordinate debt financing of infrastructure projects by FIIs and banks
  • Capital markets: process of corporatisation of stock markets expected to be completed this year
  • Sebi Act, 1992, to undergo legislative changes
  • Commitment of Rs 1,300 crore for recapitalisation of Indian banks to enhance its capital adequacy ratio
  • FII investments will not be subject to sectoral approval, except in specified sectors
  • Legislative changes proposed in the UTI Act
  • New bills for banking sector reforms to be introduced
  • Asset reconstruction companies to be set up to take over NPAs in banking sector
  • Legislative changes to corporatise IDBI in the coming year
  • Rs 1,300 crore for recapitalisation support to Indian banks
  • Nominees and directors of company boards will be exempted from punitive action for companies defaulting under Companies Act
  • Subsidiaries of foreign banks to adhere to priority sector reforms
  • Corporate credit structure to be reformed: Rs 100 crore allocated
  • Housing Finance: NHB has commenced securitisation of housing loans
  • The Banking Reform Bill to provide for faster foreclosure norms and take over of assets in case of bad loans
  • Automatic approval limit for Indian companies investing abroad enhance to $100 million from $50 million
  • Housing Finance: NHB will launch a credit-guarantee scheme
  • Target under rural housing finance scheme increased to 2.25 lakh
  • Capital account convertibility: full-convertibility of deposit schemes for NRIs
  • Indian MFs can invest in rated securities in countries with full convertible currency
  • Legislation to deal with operators linked with terrorist activities
  •  APM to be dismantled as on April 2002
  • Petro products prices to be market determined
  • Petroleum Regulatory Board to be set up
  • Fiscal deficit expected to be at 5.7 per cent of GDP this year
  • From 1 March, diesel cheaper by 50 paise and petrol cheaper by Re 1
  • Private companies allowed in distribution of petro products, subject to guidelines
  • Price of LPG raised by Rs 40
  • Kerosene for PDS up by Rs 1.5 per litre
  • Subsidy of LPG and kerosene to be reflected in Budget, and will be on specified flat rate basis from 1 March
  • Limit for composite loan by SSI increased from Rs 2 lakh to Rs 5 lakh
  • Exemption limit for collateral security increased to Rs 5 lakh from Rs 25,000
  • PSBs to launch Laghu Udyog Credit Card schemes for persons in the SSI sector
  • 50 more items to be dereserved in the small sector, which includes knitwear agri-equipments in the list
  • Janraksha: a new insurance scheme launched
  • Allocation for women development up by 33 per cent
  • National Ayurvedic Hospital to be set up in Delhi with private participation
  • At least 100 scholarships in a year to encourage women in scientific profession
  • Planned outlay for tribal welfare up 21 per cent to Rs 290 crore and planned allocation for Department of SC/STs increased by 52 per cent
  • Budget support to the ministry of information and broadcasting up 22 per cent to Rs 485 crore
  • Fertiliser subsidies to be reduced; 5 per cent increase in the issue price of urea
  • Excise duty: 16 per cent SEDs retained in PFYs, motor cars, MUVs, tyres for replacements, aerated soft drinks, ACs and pan masala
  • 16 per cent SEDs abolished for many items
  • Cigars, cheroots to attract 16 per cent CENVAT
  • LPG, kerosene to attract CENVAT of 16 per cent
  • Motor spirit ad valorem rate reduced to 30 per cent.
  • Surcharge imposed
  • Special incentives for textiles
  • Fabrics, readymade garments attract 12 per cent CENVAT
  • Textiles: abolition of 4 per cent on CENVAT of 16 per cent
  • Exemption to handloom garments also
  • No change in personal income tax rates. Section 88 benefits reduction for salary levels above Rs 1 lakh
  • Excise duty on tea reduced from Rs 2 per kg to Rs 1 per kg
  • Nine more sectors to come under the purview of service tax
  • Service tax to be imposed on life insurance agents, cargo handlers, event managements, health centres, beauty parlors etc.
  • By 2004-05, only two rates of custom s duty to remain: 10 per cent and 20 per cent
  • Peak rates of customs duty reduced from 35 per cent to 30 per cent
  • Basic customs duty on defective steel and seconds raised
  • Excise duty exemptions to granite withdrawn
  • Service tax exemptions to services provided by hotels extended up to 21 March, 2003
  • Import duty increase in rubber could impact tyre companies
  • Increase incentives through additional depreciation in plant and machinery for companies
  • Customs duty on cement and clinker reduced to 20 per cent from 25 per cent
  • Dividend tax on income distribution from MFs and corporates to go; dividend taxed through TDS
  • Rs 6,700 crore gains from excise duty and Rs 2,200 crore loss from customs duty
  • Additional depreciation to new industrialised units for expansion of installed capacity by at least 21 per cent
  • Cell phone, pagers exempted from CVD. Basic duty doubled to 10 per cent
  • Capital gains exemption for housing loans given by NHB
  • Taxable income between Rs 1.5 lakh and Rs 5lakh to get 10 per cent rebate
  • Tax exemption on VRS payment up to Rs 5 lakh extended to certain institutions
  • Penalty of Rs 10,000 imposed for faulty PAN quotations
  • Surcharge of 5 per cent on all categories for meeting defence expenses
  • Direct tax revenues to be Rs 91,585 crore
  • 12,200 government posts to be abolished by end of March 2002
  • Government relief bonds to have a reduction of 50 basis points in interest rates
  • Proceeds of small savings to be transferred to states
  • Rs 12,000 crore disinvestment target for the next year
  • Rs 12,500 crore for reforms-linked assistance to states
  • PDS sugar to be Rs 13.5/ kg
  • 20 per cent rebate allowed to persons with income up to Rs 1.5 lakh
  • Foreign companies: corporate tax reduced to 40 per cent
  • Imported liquor customs duty down from 210 per cent to 182 per cent
  • Medical equipment exempted from customs duty
  • Eight more drugs included in fully exempt list
  • Customs duty on computer hardware items reduced to 5 per cent, capital goods to 15 per cent
  • Customs duty on specified equipment in ports and airports reduced to 10 per cent
  • Excise duty on agricultural machinery and implements reduced to 15 per cent from 25 per cent
  • Excise for NFM: copper, zinc, lead reduced to 25 per cent from 35 per cent; aluminium to 15 per cent from 25 per cent
  • SEZs to be entitled to procure duty-free raw materials.

— Compiled by Shehla Raza Hasan

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