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| You are here :Home >> Budget Stories >> Report | |||||||||
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| 2009-02-16 16:36:12 | |||||||||
What Interim Budget offers for commodities sector
By Biju Thomas India's acting Finance Minister Pranab Mukherjee presented interim budget 2009/10 on Monday. While presenting the interim Budget for 2009-10 in Lok Sabha he announced that India’s agriculture outlook is encouraging and the government is committed to continue focus to this key sector and food grain production recorded an increase of 10 million tonnes each year during this period and touched an all time high of 230 million tonnes in 2007-08. Following are key points related to the “commodity sector” in his budget speech. • The Gross Domestic Product increased by 7.5 per cent, 9.5 per cent, 9.7 percent and 9 per cent in the first four years from fiscal year 2004-05 to 2007-08 recording a sustained growth of over 9 per cent for three consecutive years for the first time. The growth drivers for the period were agriculture, services, manufacturing along with trade and construction. Fiscal deficit down from 4.5 per cent in 2003-04 to 2.7 per cent in 2007-08 and Revenue deficit from 3.6 per cent to 1.1 per cent in 2007-08. • The Gross capital formation in agriculture as a proportion of agriculture GDP increased from 11.1 per cent in 2003-04 to 14.2 per cent in 2007-08 • Annual growth rate of agriculture rose to 3.7 per cent during 2003-04 to 2007-08.Exports grew at an annual average growth rate of 26.4 per cent in US dollar terms in the period 2004-05 to 2007-08. Foreign trade increased from 23.7 per cent of GDP in 2003-04 to 35.5 per cent in 2007-08. • Plan allocation for agriculture increased by 300 per cent from 2003-04 to 2008-09.Rashtriya Krishi Vikas Yojna launched in 2007-08 with an outlay of Rs.25, 000 crore to increase growth rate of agriculture and allied sector to 4 per cent per annum during Eleventh Plan period. Agriculture credit disbursement increased three times from Rs.87, 000 crore in 2003-04 to about Rs.2, 50,000 crore in 2007-08. • Interest subvention to be continued in 2009-10 to ensure that farmers get short term crop loans up to Rs.3 lakh at 7 per cent per annum. The Agricultural Debt Waiver and Debt Relief Scheme, 2008 was implemented by June 30, 2008 as scheduled. Debt waiver/debt relief amounting to Rs.65, 300 crore covers 3.6 crore farmers. • Minimum Support Price (MSP) for common variety of paddy increased from Rs.550 per quintal in 2003-04 to Rs.900 per quintal for the crop year 2008-09. In case of wheat, increase was from Rs.630 per quintal in 2003-04 to Rs.1080 per quintal for the year 2009.Major subsidies including food, fertilizer and petroleum estimated at Rs.95,579 crore. Biju Thomas is Head, Research, JRG Commodities |
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