India world’s largest arms importer?

Modernising its armed forces along the borders with China and Pakistan, India has emerged as the world’s largest importer of arms, a global think tank report said today.

The report pointed out that China, which was the largest importer of arms in 2002-2006, fell to fourth place in 2007-11 due to decline in the volume of Chinese imports along with improvements in China’s arms industry and rising arms exports.

“India was the world’s largest recipient of arms, accounting for 10 per cent of global arms imports between 2007 to 2011,” the Stockholm International Peace Research Institute (SIPRI) said in its latest report.

In the field of arms import, India has left behind both Pakistan and China along with Singapore and South Korea, the report said.

In the last five to ten years, India has taken several steps to modernise its armed forces and signed several deals to procure military hardware.

This includes deals for 10 C-17 strategic lift aircraft, six C-130 Super Hercules Special Operations aircraft, additional Sukhoi-30 MKI fighter jets along with several warships. 

Tamilnadu govt. gives go ahead to Kudankulam N-plant

Seeking to end the impasse over the Kudankulam nuclear plant issue, the Jayalalilthaa government in Tamil Nadu on Monday gave the go ahead to the controversial project and announced a Rs. 500 crore special development package for the area where it is located.

“In accordance with (today’s) Cabinet decision, immediate steps will be taken (to facilitate commissioning) of the plant,” Chief Minister Jayalalithaa said in a statement, breaking her silence over the issue.

She also sought the cooperation of political parties and all concerned to immediately resume work at the plant in Tirunelveli district, stalled following protests since September 2011, spearheaded by the People’s Movement Against Nuclear Energy (PMANE).

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Union Budget 2012-13 highlights

 

Highlights of this year's Union Budget presented by Union Finance Minister Pranab Mukherjee in the Parliament. 

Budget identifies five objectives

1. Growth recovery
2. Private investment
3. Supply bottlenecks
4. Malnutrition
5. Governance maters

Key tax rates  announced in Union budget 2012

• Income tax:  Income tax exemption limit raised from Rs. 1,80,000 to Rs. 2,00,000; 10 per cent tax for 2-5 lakh income; 20 per cent for 5-10 lakh and 30 per cent beyond Rs. 10 lakh; Savings bank account interest up to Rs. 10,000 exempted from tax. ( Tax burden for individuals will come down )
• Excise duty, Service and Corporate tax:  No change in corporate tax rate, but standard rate of excise duty, as also service tax rates, raised from 10 per cent to 12 per cent; No change in peak customs duty of 10 per cent on non-agri goods. (  Services and goods to cost more )
• Securities Transaction Tax:  Securities Transaction Tax on cash delivery reduced by 25 per cent to 0.1 per cent; A new Rajiv Gandhi Equity Saving Scheme to allow income tax deduction to retail investors in stocks. (Good for capital markets)
• Tax reforms: Direct Taxes Code (DTC) at earliest; GST network to be operational by August 2012; Central Excise and Service Tax being harmonized. A General Anti-Avoidance Rule (GAAR) to be introduced to counter aggressive tax avoidance. 
• Tax relief for stressed sectors: Sectors like agriculture, infrastructure, mining, railways, roads, civil aviation, manufacturing, health and nutrition, and environment to get duty relief; Turnover limit for compulsory tax audit for SMEs raised from Rs 60 lakh to Rs 1 crore. 

Goods for which prices will increase as a result of Union budget 2012

• Automobiles
• Consumer goods
• Watch
• Soap
• Cigerattes, bidi and pan masala
• Packaged foods
• Gold
• Imported cycles
• Imported gold bar, coin and Platinum
• Air travel
• Hotel services
• Cement and steel
• Drugs

Goods for which prices will decrease  as a result of Union budget 2012

• LCD, LED tvs of size more than 20''
• Match box
• Foot wear up to Rs.500
• Imported medical instruments
• Branded textiles
• branded silver jewellery 

Support for different sectors  announced in Union budget 2012

• Public sector banks:  Rs. 15,888 crore to be provided for capitalisation of public sector banks and financial institutions.
• Infrastructure:  Infrastructure investment of Rs. 50 lakh crore in 12th period, with half from private sector; Tax free bonds of Rs. 60,000 crore to be allowed for financial infrastructure projects.
• Stressed sectors:  Sectors like agriculture, infrastructure, mining, railways, roads, civil aviation, manufacturing, health and nutrition, and environment to get duty relief; Turnover limit for compulsory tax audit for SMEs raised from Rs 60 lakh to Rs 1 crore.
• Farming:   Target for agricultural credit raised to Rs 5,75,000 crore; Interest subvention for short-term crop loans to farmers at 7 per cent interest continues; additional 3 per cent for prompt paying farmers.
• Road transport and Highways:  Allocation of Road Transport and Highways Ministry enhanced by 14 per cent to Rs. 25,360 crore.
• Handloom and powerlooms: Financial package of Rs. 3,884 crore for waiver of loans to handloom weavers and their cooperative societies; mega handloom clusters in Andhra, Jharkhand; weaver service centres in Mizoram, Nagaland and Jharkhand; powerloom mega cluster in Maharashtra; Rs. 500 crore pilot schemes for geo-textiles in North-Eastern region.
• Small enterprises: Rs. 5,000 crore India Opportunities Venture Fund to help small enterprises.
• Rural health: Allocation for National Rural Health Mission(NRHM) is proposed to be increased from Rs.18,115 cr in 2011-12 to Rs. 20,822 cr in 2012-13.
• Education: Announced Rs.25,555cr for the integrated Right to Education and Sarva Shiksha Abhiyan Scheme. In the 12th plan, 6000 schools have been proposed to be set up at block level as model schools to benchmark excellence. Rs.3124 cr have been allocated for the Rashtriya Madhyamik Shiksha Abhiyan.

Announcements in Union budget 2012

• Attracting foreign funds: Efforts on to allow FDI(Foreign Direct Investment) in multi-brand retail and permitting foreign airlines invest in domestic players; External borrowings to the extent of USD one billion for aviation companies; Qualified Foreign Investors(QFI) to get access to corporate bond market. 
• Black money:  White paper on black money in current session of Parliament; Introduction of compulsory reporting requirement for assets held abroad; tax collection at source on high-value cash purchase of bullion, jewellery, immovable property and trading in coal, lignite and iron ore. Greater scrutiny of closely-held companies for funds; Taxation of unexplained money, credits, investments, expenses at highest rate of 30 per cent irrespective of income slab.
• Disinvestment: A modest target of Rs.30000 crore is set for disinvestment.
• Subsidies:  Central subsidies to be kept under 2 per cent of GDP; to be further brought down to 1.75 per cent of GDP over the next 3 years.
• New proposals: Mobile based fertilizer management system; LPG transparency portal; scaling up and rolling out of Aadhar enabled payment for government schemes in at least 50 districts.
• Rajiv Gandhi Equity Saving Scheme: to allow income tax deduction to retail investors on investing in equities.

Financial aspects of Union budget 2012

• Direct proposals to give in net revenue loss of Rs. 4,500 crore and net gain of Rs. 45,940 crore from indirect taxes, resulting into a net gain of Rs. 41,440 crore. 
• Fiscal deficit targeted at 5.1 per cent of GDP in 2012-13, down from 5.9 per cent in 2011-12; Central Government debt at 45.5 per cent of GDP. 
• Total expenditure budgeted at Rs. 14,90,925 crore; plan expenditure at Rs. 5,21,025 crore, 18 per cent higher than 2011-12 budget; non-plan expenditure at Rs. 9,69,900 crore. 
• Gross Tax Receipts estimated at Rs. 10,77,612 crore, 15.6 per cent higher than original budget estimates and 19.5 per cent over the revised estimates for 2011-12. 
• Net tax to the Centre in 2012-13 estimated at Rs. 7,71,071 crore; Non-Tax Revenue Receipts estimated at Rs. 1,64,614 crore and Non-debt Capital Receipts at Rs. 41,650 crore. 
• Total expenditure for 2012-13 budgeted at Rs. 14,90,925 crore, including Rs. 5,21,025 crore of Plan Expenditure and Rs. 9,69,900 crore as Non-Plan Expenditure. 
• Defence services get Rs. 1,93,407 crore; any further requirement to be met. 

New scheme proposals

• National Urban Health Mission
• National Rural Livelyhood Mission is likely to be renamed 'Aajeevika'

Other key points

• Funds for MGNREGA slashed to RS.33000cr from Rs.40000cr on the backdrop of poor performance by the scheme and the request from agriculture ministry.
• Duty exemption for life saving drugs: Excise duty on six specific life-saving drugs and vaccines is exempted.
• Accredited Social Health Activist(ASHA) scope expanded.