Budget speech 2007-08: Full text

FM'S SPEECH: Chidambaram said that there were many pluses and a few minuses, both of which he dealt with in his speech candidly.

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Farmers who have not benefited from Budget loan waiver will be considered.

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• Sonia hints at more concessions for farmers
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Keywords: 2007-08, Speech

Women

There is growing awareness of gender sensitivities of budgetary allocations. 50 ministries/departments have set up gender budgeting cells. For 2007-08, 27 ministries/departments and 5 Union Territories covering 33 demands for grants have contributed to a statement placed in the budget papers. The outlay for 100 per cent women specific programmes is Rs 8,795 crore and for schemes where at least 30 per cent is for women specific programmes is Rs 22,382 crore. We have made a sincere effort to remove the errors that were pointed out in last year's statement.

North Eastern Region

The total budget allocation in 2007-08 for the North Eastern Region, culled out from allocations under different ministries/ departments, has increased from Rs 12,041 crore in 2006-07 to Rs 14,365 crore in 2007-08. This includes Rs.1,380 crore provided to the Ministry of Development of North Eastern Region (DONER). The new industrial policy for NER, with suitable fiscal incentives, will be in place before March 31, 2007.

Supplement to the GBS

I have, so far, outlined the allocations under what may be called Plan 'A' which has a resource basket of Rs 205,100 crore. In consultation with the Planning Commission, I have also drawn up Plan 'B'. Since the Eleventh Plan will begin on April 1, 2007, we recognize that there will be a need to take new initiatives in critical areas. Additional resources will be needed once the proposals are finalised and the pace of expenditure builds up. Therefore, I shall endeavour to find additional resources through better tax administration to the extent of Rs 7,000 crore during the course of the year. I have been advised by the Planning Commission that these additional funds, once voted by this House, will be allocated among sectors such as agriculture, rural development, health, women and child development, urban infrastructure, water resources, etc.

I also have Plan 'C'. Under Plan 'C', I propose to tap into resources available outside the Budget and leverage them for the purpose of investment, especially in the infrastructure sector. I shall deal with this subject a little later.

AGRICULTURE

I shall now take up our main challenge: agriculture. I may recall the words of Jawaharlal Nehru, who said "Everything else can wait, but not agriculture".

The draft National Policy for Farmers submitted by the National Commission on Farmers is under consideration. Meanwhile, I have a number of proposals to improve the economic viability of farming and ensure that farmers earn a minimum net income.

Farm Credit

Farm credit continues to grow at a satisfactory pace. The goal of doubling farm credit in three years was achieved in two years. The target of Rs 175,000 crore set for 2006-07 will be exceeded comfortably and is likely to reach Rs 190,000 crore. This year, until December 2006, 53.37 lakh new farmers were brought into the institutional credit system. For 2007-08, I propose to fix a target of Rs 225,000 crore as farm credit and an addition of 50 lakh new farmers to the banking system.

The two per cent interest subvention scheme for short-term crop loans will continue in 2007-08, and I am making a provision of Rs 1,677 crore for that purpose.

A special plan is being implemented over a period of three years in 31 especially distressed districts in four States of the country involving a total amount of Rs 16,979 crore. Of this, about Rs.12,400 crore will be on water related schemes. In order to provide subsidiary income to the farmer, the special plan includes a scheme for induction of high yielding milch animals and related activities. I propose to provide Rs153 crore for this scheme.

Agricultural Indebtedness

Government had appointed a Committee under Dr. R. Radhakrishna to examine all aspects of agricultural indebtedness. The Committee has held wide ranging consultations across the country and is in the process of finalising its recommendations. Government will act on the report as soon as it is received.

A Mission for Pulses

Government is concerned about the stagnation in the production and productivity of pulses. A critical deficiency is the availability and quality of certified seeds. I therefore propose to expand the Integrated Oilseeds, Oil palm, Pulses and Maize Development programme. There will be a sharper focus on scaling up the production of breeder, foundation and certified seeds. The Indian Institute of Pulses Research (IIPR), Kanpur, the National and State level seeds corporations, agricultural universities, ICAR centres, KRIBHCO, IFFCO and NAFED as well as large private sector companies will be invited to submit plans to scale up the production of seeds. Government will fund the expansion of IIPR, Kanpur, and offer the other producers a capital grant or concessional financing in order to double the production of certified seeds within a period of three years.