Mukherjee announes slew of measures as house approves bill amid opposition walkout

Even as he stuck firmly to the no roll back of petrol and diesel prices line union finance minister Pranab Mukherjee yesterday announced a slew of measures that would give relief to various sectors.

He announced a debt relief package for coffee growers and announced marginal changes in tax proposals to benefit sectors such as construction and encourage the setting up of new hospitals.

He, however, rejected the demand for withdrawal of service tax on air travel as the levy, for domestic travel would only amount to Rs100 per ticket while international travel would attract a maximum tax of Rs500.

Stoutly defending his tax proposals, while replying to discussion on the Finance Bill 2010 in the Lok Sabha, Mukherjee pointed out that the proposals would leave a net revenue loss of Rs300-400 crore in the fiscal, and a rollback in the prices of petroleum products and fertilisers was not affordable in view of the economic compulsions.

The opposition, not impressed with Mukherjee's unyielding stand on the petrol price hike staged a walk out starting with the BJP and joined later by other parties. The house passed the bill by voice vote with the inclusion of the relevant official amendments.

While seeking cooperation from all parties to limit food inflation and keeping the growth momentum, Mukherjee explained that due to the financial position of the exchequer, the huge outgo due to food and fertiliser subsidies, interest payments and other liabilities would add to the oil marketing companies' (OMCs) under-recovery of Rs85,000 crore during the year.