UNION BUDGET 2012Key Highlights

Approach to the Budget: 1. GDP is estimated to grow by 6.9% in 2011-12,

after having grown at 8.4% in preceding two years. 2. Key reasons for the interruption of Indian economy: euro zone crisis, economy, political turmoil in Middle East and rise i`n crude oil price. 3. Growth moderated due to tight monetary policy. 4. Economy is turning around as core sectors and manufacturing show signs of recovery. 5. At this juncture, hard decision is needed to improve macroeconomic environment and strengthen domestic growth drivers. 6. Twelfth Five Year Plan to be launched with the aim of "faster, sustainable and

UNION BUDGET 2012Key Highlights

BUDGET HIGHLIGHTS Exemption limit for the general category of

individual taxpayers enhanced to Rs 2,00,000 Service tax rate raised from 10% to 12% Standard rate of excise duty to be raised from 10% to 12% No change proposed in the peak rate of customs duty of 10 per cent on nonagricultural goods. For 2012-13, Rs 30,000 crore to be raised through disinvestment Reduction in securities transaction tax by 20 per cent on cash delivery transactions Rajiv Gandhi Equity Saving Scheme to allow for income tax deduction of 50 per cent to new retail investors, who invest upto Rs 50,000 directly in equities

UNION BUDGET 2012Key Highlights

Overview of the economy: 1. GDP growth estimated at 6.9% in real terms in

2011-12. 2. Headline inflation expected to moderate further in next few months and remain stable thereafter. 3. Current account deficit at 3.6% of GDP for 201112. 4. Deterioration in fiscal balance in 2011-12 due to slippages in direct tax revenue 5. and increased subsidies. 6. India's GDP growth in 2012-13 expected to be 7.6% +/- 0.25%. 7. Fiscal deficit for 2012-13 pegged at Rs 5,13,590 crore, which is 5.1 per cent of GDP.

UNION BUDGET 2012Key Highlights

Subsidies:

1. Efforts to keep central subsidies under 2% of GDP in 2012-13. Over next 3 year, to be further brought down to 1.75%. 2. Subsidies related to administering the Food Security Act will be fully provided for. 3. A mobile-based fertilizer management system (recommended by the task force headed by Nandan Nilekani) has been designed to provide end-to-end information on movement of fertilisers and subsidies. Nationwide roll out during 2012. 4. State-owned oil marketing companies have launched LPG transparency 5. portals to improve customer service and reduce leakage. Endeavour to scale up and roll out Aadhaar enabled payments for various government schemes in at least 50 districts within next 6 months.

UNION BUDGET 2012Key Highlights

BUDGET INTERPRETATIONS Pharma sector be affected by increase in excise

duty rates Duty rate hikes to adversely affect common man Excise hike on beedi, other tobacco products; positive for ITC LNG exempt from customs duty; positive for GAIL and other gas dist cos, power cos and fert cos Basic exemption limit for individuals increased; savings to the extent of Rs 22,000 on income on Rs 10 lakh Introduction of negative service tax list to widen service tax net STT reduced to 0.01%; positive for IIFL, JM, Edel, Motilal

UNION BUDGET 2012Key Highlights

BUDGET FLASHES Raise customs duty on some vehicle imports to

75% from 50% Branded silver jewellery exempt from excise duty 10% advalorem duty on cigarettes Advolarom duty on some cigarettes Doubled custom duty on refined gold Excise duty on cigarettes raised Customs duty on non std gold raised to 10% from 5%