Chidambaram plans 12 percent increase in budget spending
New Delhi, Feb 28 : The federal budget Finance Minister P. Chidambaram presented Thursday targets an aggressive 29.4 percent jump in plan expenditure and containing the fiscal deficit at 4.8 percent of the gross domestic product in the financial year beginning April 1.
The finance minister pegged the overall budgetary expenditure at Rs.16.65 lakh crore (Rs.16.65 trillion or $302.78 trillion) for the next financial year, 11.69 percent higher than the revised estimate of Rs.14.91 lakh crore for the 2012-13.
Plan expenditure will increase by 29.4 percent to Rs.5.55 lakh crore. Non-plan expenditure for the next financial year is pegged at Rs.11.09 lakh crore, nearly 10 percent higher than the Rs.10.01 lakh crore estimated for the current financial year.
To finance this ambitious spending plan, Chidambaram targets to get Rs.10.56 lakh crore from revenue receipts. This includes Rs.8.84 lakh crore from tax revenue and Rs.1.72 lakh crore from non-tax revenue.
Target from capital receipt is set at Rs.6.08 lakh crore, a majority of it will be from borrowings. In fact, of the total budgeted receipt, 27 percent will come from borrowings and other liabilities.
Receipts from borrowings and other liabilities are budgeted at Rs.5.42 lakh crore. Rs.10,654 will come from recoveries of loans and Rs.55,814 crore will come from other receipts.
The revenue deficit for the next financial year is pegged at Rs.3.79 lakh crore or 3.3 percent of the GDP. Revenue deficit for the current fiscal is estimated at 3.9 percent of the GDP.
Chidambaram marginally revised upward fiscal deficit for the current financial year at 5.2 percent from 5.1 percent estimate made by his predecessor Pranab Mukherjee in March last year.
For 2013-14, fiscal deficit target is pegged at Rs.5.42 lakh crore or 4.8 percent of the GDP.
Of the total expenditure, 18 percent will go on interest payments, 12 percent on subsidies, 10 percent on defence, 21 percent on central plan, 7 percent on plan assistance to states and union territories, 4 percent on non-plan assistance to state and union territories and 17 percent will be states' share of taxes and duties.
Corporate tax will contribute 21 percent of the total receipt, while 12 percent will come from income tax. Nine percent of the total receipt will come from customs, 10 percent from union excise duties, 9 percent from service and other taxes, another nine percent from non-tax revenue and 3 percent from non-debt capital receipts.
The single largest source of the government's receipt will be borrowings. Of the total receipts 27 percent will come from borrowings and other liabilities.