The 80th Union Budget for the fiscal year 2011-12 presented by the Finance Minister, Pranab Mukherjee, has in its fold a number of important policy decisions that have huge implications for furthering development and improving governance in the country.
What is heartening to note in this year’s budget is that the government has amplified the flow of resources to rural areas to give more inclusive plunge to the development process. Allocation for Bharat Nirman package programmes has been increased by `10,000 crore. In an effort to bridge the digital divide, the Finance Minister has made announcement to provide Rural Broadband Connectivity to all 2, 50,000 Panchayats in the country in three years. However, it is to be seen how rural broadband connectivity can be extended within this stipulated period.
Although, the budget has laid special emphasis on improving governance through Unique ID (UID) number, there are no allocation figures of UID numbers specified by FM in his speech, which is quite unexpected.
In the taxation sector, the budget talks of extending the current IT initiatives like e-Filing and e-Payment of taxes. It also lays emphasis on web based facility for tax payers to track the resolution of refunds and credit for pre-paid taxes and augmentation of processing capacity. The National e-Governance Plan has got a boost in the current year’s budget. Under Mission Mode Projects (MMPs), funds would be released to 31 projects received from States/ UTs for computerisation of commercial taxes. For financial inclusion of the economically weaker sections of society, there is a move to set up banks in villages of more than 2000 people. In this direction, the proposed bill to allow RBI to grant more banking licenses and additional support to NABARD is also noteworthy.
Celebrations are in the offing when it comes to inclusion of poor in the health insurance sector. Rashtriya Swasthya Bima Yojana is to be extended to cover unorganised sector workers in hazardous mining and associated industries like slate and slate pencil, dolomite, mica and asbestos.
All these measures taken by the government is being much appreciated across all quarters. Although, the industry has welcomed this year’s budget, they have found non-extension on STPI benefits as very demoralising. There is also the resentment over the three percent increase in MAT (minimum alternative tax) in the union budget which will result in higher outgo of cash. Hope the government will take a serious look at the concerns expressed by the industry since the absence of incentives for small and medium IT businesses will affect Indian corporates adversely.