Welcome to ISI tax
Gujarat burns alive in backlash
Watch your pockets, salaried & savers
Bollywood gives but gets not
Govt faces Desam heat
Tourism gets jump, hungry for more
Surcharge, N-fund veil over defence hike
Peanuts for primary education: Experts
Budget cheer for diabetics
Calcutta Weather

New Delhi, Feb. 28: 

Surcharge Sinha strikes

From Guwahati to Godhra, from Kashmir to Kanyakumari, the ISI has struck at will across the length and breadth of the country. It attacked Parliament, too.

Today, it infiltrated into the budget.

Yashwant Sinha introduced a 5 per cent national security surcharge that — patriotic or not — every tax-paying citizen has no choice but to fork out, except those with a total income below Rs 60,000.

The finance minister withdrew the 2 per cent quake surcharge he had imposed in the last budget, but decided to take 3 per cent more with his ISI tax because “national security is an overriding concern”. The day after the incident in Gujarat, which the government is blaming on the ubiquitous ISI, no one can question that concern. Hence, pay up.

And blame it on the ISI.

The finance minister squeezed the knife into the system to gouge out Rs 12,700 crore in fresh levies, Rs 2,750 crore through the ISI tax alone. He is collecting Rs 6,700 crore from excise increases and Rs 3,250 crore by slashing income-tax rebates. After a Rs 2,200 crore revenue loss through customs duty cuts, net additional revenue will be Rs 10,500 crore.

Indian industry is unhappy with the budget because it thinks its overriding concern of stimulating growth has not been addressed. “This budget is unlikely to boost growth rates. It may, at best, sustain the current rates. I would call it an achievable, deliverable budget,” said CII president Sanjiv Goenka.

The stock market pounced on Sinha with its customary cruelty. The Bombay Stock Exchange sensitive index ended the day at 3562.31 points, which meant a loss of 143.35, knocking Rs 27,000 crore off investor wealth.

Politically, too, the budget may be fraught with dangers if the response of BJP ally Telugu Desam was an indication. Attacking the fresh taxes, N. Chandrababu Naidu said: “We are totally opposing these proposals.”

Apart from the 5 per cent surcharge, Sinha extended service tax to more areas, cut the interest rate on small savings, rolled back tax rebates, shifted the 10 per cent tax on dividend earnings on to the recipient and raised prices of cooking gas, kerosene, sugar and fertilisers. Petrol and diesel will cost less.

Defending the ISI surcharge, Sinha said: “I have to find the money somewhere given the difficult fiscal situation. I can’t produce it out of the blue. We must remember the difficult situation on the borders.”

The situation on the borders has not led to any great increase in the defence outlay, which has gone up by only Rs 3,000 crore to Rs 65,000 crore, barely taking care of inflation. But Sinha gave colleague George Fernandes a blank cheque that he will come up with the extra dash of cash whenever needed.

Although squeals of joy could not be heard above the dead weight of negative sentiment, there were middle-roaders who advised a realistic assessment. “The market expects too much sometimes,” said HSBC India’s CEO Zarir Cama.

The trouble with the budget — as some of its critics saw it —is its lack of ambition. Last year, Sinha had begun by being too ambitious and ended in anguish. “You cannot have grand plans year after year. It was there in the last budget,” Sinha said.

He listed consolidation of reforms, partnership with states in fiscal reforms and privatisation as key features of the budget.

In continuation of the policy of freeing up the market for agricultural products — kisan ki azaadi, according to the finance minister — Sinha announced a series of steps, along with higher spending on rural roads and stimulants to electrification and employment.

He asked states to open up agriculture markets if they wished to get additional allocations for Centre-sponsored schemes and spoke of linking urban development funds with reforming land ceiling laws and levying higher municipal charges.

For infrastructure development, he set as a primary condition imposition of reasonable user charges. In power, he came up with more money under a scheme in which state electricity boards can clean up their balance sheets by eliminating the gap between cost and price.

Taking state-level fiscal reforms further, he announced an allocation of Rs 2,500 crore to encourage policy changes to remove constraints on growth.

Sinha has stepped up public investment in infrastructure sharply. For power, the plan outlay is rising by 22 per cent, for roads and national highways by 39 per cent and for railways by 23 per cent. All this will add up to Rs 37,919 crore. Similarly, budget support for Central, state and Union Territory plans has been increased by over 19 per cent, the highest rise in over a decade.

A Bollywood aficionado, Sinha offered more “khushi” and less “gham” to the entertainment industry, introducing sops for multiplexes.

But industry as a whole, ready for a little gham if mixed with some khushi, got what it did not want: lagaan.


Feb. 28: 
Gujarat today bled and burned in the Godhra backlash.

Around 80 people lost their lives as angry mobs rampaged through the state, torching houses, shops and mosques and looting and killing at random, a day after kar sevaks returning from Ayodhya were charred inside a train. The biggest single act of violence was an attack on a housing complex in Ahmedabad, where at least 38 people were dragged out of their homes and individually set on fire. But the incident could not be confirmed.

The Vajpayee government, alarmed that law and order were spiralling out of control, ordered deployment of the army in the state. The army has already begun pre-deployment drills in violence-scarred areas and will be out latest by tomorrow morning. Defence minister George Fernandes is travelling to Gujarat tomorrow.

A belligerent VHP, however, reiterated that it would start temple construction as scheduled and called a nation-wide bandh tomorrow. It also raised the pitch for Prime Minister Atal Bihari Vajpayee’s resignation, dubbing his regime “ravan raj”.

But the RSS sought to cool temperatures, stepping in directly mediate between the Centre and the VHP. Senior Sangh leaders, including H.S. Seshadri and Madan Das Devi, held hour-long talks with Vajpayee.

“The government spelt out its responsibilities and compulsions vis-à-vis the law and the courts to us and how these should be enforced. We will see what can be done,” Devi said.

On a day the protesters ran riot statewide, the most gruesome killing took place in Meghaninagar in Ahmedabad. A 1,000-strong armed mob descended on the Gulmarg Society housing complex — where there are 16 houses — and burnt all the residents to death, including a former Congress MP and his family. Officials fear the toll could be higher.

Curfew was clamped in 26 towns after rioters targeted petrol pumps, shops and business houses in retaliation to yesterday’s train tragedy. Cars burned in the streets and at several street corners, youths made bonfires of looted goods. A pall of smoke overhung several towns.

Authorities said police were forced to open fire and lob tear gas shells at several places as protesters got out of hand during today’s VHP bandh. Two persons died in police firing in Nadiad and Godhra.

Chief minister Narendra Modi called a news conference to calm rising passions and assured the people his government would not spare those responsible for the “barbaric and inhuman” act. He said 80 people, including some councillors, were arrested from Godhra alone.

“At least 20 people have been killed, including two in police firing in Nadiad and Godhra,” Modi said in the evening. But he added that considering the heinous nature of the tragedy, the people were restrained.

“There is a fire inside us. Our blood is boiling,” Mangalben, a woman from Daripur, said. “What is the fault of those children who died? There is a volcano of anger.”

Arson, stabbing and looting spread from Ahmedabad and Bharuch to Gandhinagar, where the offices of the Waqf Board and the Gujarat State Minority Finance and Development Corporation were razed. Police said a mob burned down a mosque in Delol, 25 km inside Godhra.

In upmarket areas of Ahmedabad, lathi-wielding miscreants targeted footwear shops. Elsewhere policemen watched silently as the protesters went berserk.

“There is tension. It can take one incident to start a fire,” inspector general Pravin Godiya said, adding that police had warned people not to be provoked. “We have told them not to retaliate, to not behave with a crowd mentality.”


New Delhi, Feb. 28: 
No cuts in the marginal rates of taxation, no increase in standard deduction and the traditional tax shelters have shrunk — it’s a tripwire for the salaried individual.

Those who have put their life’s earnings in small savings accounts have also been dealt a blow — interest rates on most schemes have been reduced by half a percentage point.

The maximum marginal rate of tax on personal incomes has been retained at 30 per cent and the qualifying ceiling has also been kept at Rs 1.5 lakh even though many had lobbied the government to raise the ceiling to Rs 3 lakh if nothing else.

One of the arguments advanced in favour of raising the income ceiling was that in countries like Hong Kong and China, the maximum rate is 45 per cent, but it is applied only on incomes in excess of Rs 70 lakh. The 35 per cent rate is applied on incomes above Rs 40 lakh.

Besides the national security surcharge, there’s more bad news for the salaried class, which has always tried to use some adroit tax planning to save on taxes. For people with taxable incomes in the range of Rs 1.5 lakh to Rs 5 lakh, the whole process now comes apart with the 20 per cent tax rebate being slashed to 10 per cent.

The cut covers several instruments like public provident fund, long term deferred annuity schemes, national savings schemes and specified government securities. Taxpayers with incomes above Rs 5 lakh will not get any tax rebate under Section 88.

Several taxpayers invest in life insurance policies and the usual spiel that the agent comes up with is that it is a good tax hedge. But this will also pinch the pocket a little more because Sinha has now extended the service tax of 5 per cent to insurance policies as well.

This is a blow to the fledgling insurance companies which are trying hard to gain a toehold in the competitive market but it will hurt the taxpayers more. It is not clear whether this will now be charged every year on the insurance premium paid.

Insurance industry sources said this would have to be borne by the person seeking an insurance cover, and not the agent. However, it is a possibility that the agent may offer to bear the service tax in the first year to snag a customer.

The government is aiming to mop up an additional Rs 6,000 crore mainly through withdrawal of various direct tax exemptions and imposition of the 5 per cent surcharge in the new financial year. Though the finance minister kept corporate tax rate unchanged at 35 per cent, he cut the tax rate on foreign companies to 40 per cent from 48 per cent.

The cut in the administered interest rate on most small savings schemes will come into effect from tomorrow. The reduction is being seen as a precursor to another round of interest rate cuts by banks.

The rate of return on public provident fund and postal monthly income scheme, two savings options popular among salary earners, will now go down from 9.5 per cent to 9 per cent.

Maturity period on Kisan Vikas Patra, which doubles savings, will go up from the current seven years and three months to seven years and eight months. Interest on postal time deposit with a five-year maturity will go down to 8.5 per cent from 9 per cent. On three-year time deposits, the rate is being lowered to 7.5 per cent from 8 per cent.

The lowering of these rates have brought them nearer to bank deposits rates which average around 8 to 8.5 per cent.

The finance minister justified the cut by saying that it was more prudent to benchmark the rates to the average annual yields of government securities.

The real reason why the government wants to cut down on this rate, of course, is its own huge outgo on interest payouts which will hit an all-time high of Rs 1,40,615 crore during the coming fiscal year, an increase of 14 per cent.

The interest on Government of India Relief bonds has also been reduced by half a percentage point. It also set a limit of Rs 2 lakh a year on investment in these bonds.


Feb. 28: 
Bollywood supplied the humour, but the film industry is feeling left out after Yashwant Sinha’s budget speech.

The industry was looking forward to the finance minister — who has been peppering his text with “filmisms” — to put it on a par with infotech and telecom. But that was not to be.

“It was a disappointment. We were expecting a lot of incentives on the technology front. We wanted some kind of parity with the IT sector as so much software is film-driven,” said Bobby Bedi, Bandit Queen’s producer.

Sinha has made two proposals regarding the entertainment industry: tax relief for multiplexes in rural areas and relaxation of import duties on uplinking equipment. But industry people, who are for corporatisation, are disillusioned as Ficci had submitted a number of proposals to the Centre for relaxing import duties on all equipment.

“The possibility of multiplexes in rural areas is remote. They may not happen even in 15 years. And uplinking facility is not directly related to the film industry, though it should benefit television,” Bedi said.

In his speech, Sinha said film exports have been roughly doubling every year over the past three years — it could cross Rs 1,000 crore in 2001-02 — and it was time to bring in a fiscal regime to ensure more khushi and take away the remaining gham from the entertainment industry. “Filhaal, I shall have more to say on this later.”

Bedi said it was a “great pat on the back” that the entertainment sector found its way into the budget speech. “This is the first time the industry has been seriously mentioned in a budget speech. But Mr Sinha mentioned us, then just forgot us.”

Trade analyst Komal Nahata also said Bollywood was disappointed. “After giving us industry status and there being so much talk on corporatisation, the budget was a royal snub.”

But not all are pessimistic. Senthil Kumar of Real Images Media Technology, Chennai, said the budget was welcome for its two proposals. Even Bedi hoped things might look up after the initial disappointment. “I haven’t read the fine print,” he said, echoing CII chief and RPG enterprises vice-chairman Sanjiv Goenka. “There might be something there when I go through it tomorrow.”

Sinha also angered a large section of the cable television industry by deciding to levy a 5 per cent service tax that operators would possibly pass on to consumers.

“I think Yashwant Sinha should resign on this count alone. He is talking of sops to multiplex-wallahs who provide entertainment for the rich at the cost of the cable operators who provide mass entertainment,” said Roop Sharma of the Cable Operators Federation of India.


Feb. 28: 
The Opposition today dubbed the budget a “big disappointing exercise”, saying it was “anti-poor” and “anti-farmer”.

Some NDA allies, too, voiced reservations about the proposals to increase LPG and kerosene prices and cut fertiliser subsidy. Pointing out that the proposals would hit farmers and the poor, the Telugu Desam, the Trinamul Congress and the MDMK urged finance minister Yashwant Sinha to reconsider them.

Mamata Banerjee said the Union budget was “harmful for the common people”, who would suffer because of the hike in prices, cut in small savings interest rates and the 5 per cent surcharge on income tax. “We will place our views on the budget on the floor of Parliament,” she said.

Andhra Pradesh chief minister and Desam chief Chandrababu Naidu said the increase in LPG and kerosene prices and the cut in fertilizer subsidy were a cause of concern. The party will press for a “reversal” of these measures, he added.

Naidu welcomed the reduction of excise on handlooms but said it was not enough. The Desam chief also welcomed the 100 per cent collections of small savings by states. But he felt the reduction in the rate of interest by 50 basis points on central loans was inadequate.

The budget is reform-oriented but has failed to focus on the basic issues affecting the common man, Naidu said. Hike in the prices of LPG and kerosene “will affect our Deepam project”, he said.

Congress chief whip Priya Ranjan Das Munshi alleged the budget had exposed the Centre’s dependence on foreign companies out to destroy the level playing field of Indian industry. The proposed hike in LPG and kerosene prices would further hurt the small-scale industry and weaken the poorest of the poor, he said.

Jairam Ramesh, who heads the AICC’s economic department, said the budgetary provisions would not revive growth or investment. “It is packed with tokenism,” he said.

Jairam said it was impossible to take Sinha’s promises at face value. “Look at the schemes that he announced today. Many of them are old schemes which have been renamed.”

Shivraj Patil, deputy leader of the Congress in the Lok Sabha, dubbed it a “beaten track” budget and said agriculture had not been given enough attention.

CPM leader Somnath Chatterjee said the budget was being dictated by the WTO and the US.

“We have lost our economic independence. Foreign companies and corporate houses have been given encouragement while most sections of the people would be affected by the proposals. With this budget, we are in a deeper mess. There is no explanation why there is a slowdown in the industry from 6 per cent to 2 per cent.”


New Delhi, Feb. 28: 
An international survey had placed India in 153rd position out of a list of 160 countries as far as government expenditure in tourism goes. With a 50 per cent hike in plan outlay for tourism to Rs 225 crore for 2002-2003, India’s position is likely to go up. But not all that much.

Says Maharaj I.S. Wahi, president of the Indian Association of Tour Operators and running the Travel Promotion Bureau: “We had asked for an outlay of Rs 1,100 crore. With that we could have undertaken a media blitz like Singapore, Malaysia and Sri Lanka. Instead, what we have got is peanuts.” Wahi adds that the hospitality industry has got more incentives than the travel industry.

What Wahi terms as peanuts is, however, considered as some improvement by many travel industry representatives. Finance minister Yashwant Sinha’s package promises six tourism circuits to be identified for development to international standards during 2002-03; special purpose vehicles permitted to raise resources from both public and private sectors for infrastructure development in these circuits; one special area, the world heritage site of Hampi, will be developed as an international destination for tourism based on an integrated master plan.

Other than these, there is fiscal relief for the tourism sector. Exemption of service tax on catering has been extended by another year. Expenditure tax on hotels will apply only to room charges. It will be payable for rooms costing Rs 3,000 per night or above against the existing rate of Rs 2,000 per night. Deductions available under section 80 HHD of Income Tax Act in respect of foreign exchange earnings of hotels and tour operators will now enjoy parity with deductions available to exporters under section HHC.

Deduction of 50 per cent of profits earned by units setting up and operating large convention centres will be allowed for five years under Section 80-1B. Other advantages that will accrue indirectly to the tourism sector relate to the incentives given to private sector participation in greenfield airports.

The customs duty on imported liquor is also being reduced from 210 per cent to 182 per cent. Rationalisation of rates of CVD is proposed and is applicable to liquors and wines to 75 per cent for value up to $25 per case and 50 per cent for others instead of the three slabs at present of 75 per cent, 100 per cent and 150 per cent. All this is eyewash, says Subhash Goyal, president of the Conference Of Tourism Professionals and chairman, Assocham committee on tourism and aviation. Wahi agrees and points out that the industry requested bringing down the duty to a substantially lower level to be competitive with other tourism-friendly destinations.

Wahi says the travel industry will get no direct benefit unlike the hospitality industry. The incentives are not enough to kickstart the industry, he adds.

Goyal echoes Wahi’s sentiment. He expresses unhappiness over the budget proposals and says an opportunity has been missed to bring it at par with software and infrastructure sector. Goyal is particularly disappointed that the exemption of service tax has not been extended to tour operators, travel agents and tourist guides. The travel industry has the potential for greater foreign exchange earning and employment creation. At present, the industry contributes Rs 14,000 crore in foreign exchange to the exchequer.

However, he stresses that there are some plus points. Wahi agrees. He says the “only silver lining” lay in the fact that tourism has finally figured in the agenda of the finance minister. Says Ram Kohli, secretary general, PATA Worldwide: “It is a very positive sign that tourism has been mentioned for the first time in the budget.”

More enthusiastic endorsements were coming from the hospitality sector. Sham Suri of the Federation of Hotel and Restaurants Association of India said he was very happy with the incentives given in the budget.

Lalit Suri of Bharat Hotels and president of the Hotel Association of India “welcomes the first ever roadmap for tourism growth outlined in a Union budget”. He is happy with all the incentives as they are “positive and growth-oriented”. However, HAI is disappointed at not being granted infrastructure industry status. Nevertheless all concerned consider the budget a positive step in boosting tourism.


New Delhi, Feb. 28: 
The Centre has disguised its hike in military expenditure by keeping the rise in the defence budget at a modest Rs 3,000 crore — a meagre 4.8 per cent higher than last year’s estimate of Rs 62,000 crore.

The real expenditure on defence is expected to go up by 14 per cent and more. This does not take into account all the funds earmarked for nuclear weaponisation.

In addition, the fund created by levying the national security surcharge of 5 per cent on all taxpayers will invariably be used to meet defence expenses for internal security.

As usual, the defence budget is the most opaque of fiscal documents and evades detailing military expenditure on specific heads. Finance minister Yashwant Sinha also told the House that should the need arise, there will be no dearth of funds for the armed forces.

Defence minister George Fernandes, worried till this month because funds under capital expenditure were being returned unspent, said he was satisfied with the allocations.

The defence ministry had mooted the idea of a fund created out of the money unspent on acquisitions in previous years. But budgetary rules have not been amended to accommodate the request. The capital outlay for defence has been hiked to Rs 21,410.63 crore from Rs 19,950 crore in last year’s budget estimates.

The cost of putting the forces under high alert under Operation Parakram has not been shown under a separate head. But Sinha said it took nearly Rs 400 crore to maintain the troops on the border for a month.

Apart from this, the revised estimates for 2001-2002 show that expenses under transportation, works and special allowances have gone up substantially even though the total budget for the current year was pared down by Rs 5,000 crore to Rs 57,000 crore.

“Basically, this shows that even the ‘new’ procurement processes that are said to have been put in place after Kargil are not nimble and responsive enough,” said analyst Commodore Uday Bhaskar, deputy director of the Institute of Defence Studies and Analysis.

“The time has now come to look at our threat profile and acquire capabilities that are commensurate with it,” he said.

The defence ministry recovered remarkably well after reeling under the impact of the Tehelka sting operations and subsequent charges from the Comptroller and Auditor General (CAG) which made decision-making tardy.

According to the revised estimates, the ministry has surrendered an unspent Rs 5,000 crore, paring down the defence budget for 2001-2002 to Rs 57,000 crore.

Fernandes had said that in the first five months of the year, barely 15-20 per cent of the budget was spent. Even in January, an estimated Rs 12,000 crore of the capital allocation of Rs 19,950 crore was unspent.

Ministry sources said contracts signed with the Russians have taken up the bulk of the expenses. These include about Rs 1,000 crore for Krasnopol ammunition and money for the supply of T-90 tanks that are replenishing the armoured units.

In 2002-2003, the allocation for the army totals Rs 38,810.15 crore of which Rs 7,384.8 crore is for capital expenditure, meaning purchase of new equipment. The navy gets Rs 7,092.05 crore of which Rs 2,443.94 is for capital expenses. Apart from this, Rs 2,473.79 crore has been shown under the head “naval fleet” and Rs 400.57 crore under “naval dockyards”. The air force gets Rs 15,827.25 crore of which Rs 7,402.17 crore is for capital expenditure.

While the revenue expenditure for the army has gone down by about Rs 500 crore, that for the air force and the navy has increased by about Rs 450 crore and Rs 600 crore, respectively. The hike for “aircraft and aero engines” in the capital expenses for the air force alone is Rs 2,400 crore.


New Delhi, Feb. 28: 
Human resources development minister Murli Manohar Joshi is not likely to be overjoyed with the hike in allocation for primary education, a key sector in his ministry.

Though finance minister Yashwant Sinha claimed an overall hike of 30 per cent in elementary education and adult literacy, education experts said the hike in primary education was nominal.

“Last year, allocation to primary education stood at Rs 4,000 crore. This year it is Rs 4,900 crore which means there has been an increase of Rs 900 crore only,” said Sanjiv Kaura, coordinator, National Alliance for Fundamental Right to Education.

The government has allocated Rs 2,125 crore for secondary and higher education — a hike of Rs 305 crore. Allocation to the human resources development ministry, including all its departments, has gone up by Rs 2,005 crore.

Kaura said the Tapas Majumdar Committee report on financing primary education suggested Rs 18,000 crore for the sector. “This allocation is just peanuts.”

Sarva Siksha Abhiyan — a pet scheme that Joshi recently launched — has received Rs 1,650 crore for universalisation of elementary education, a goal the government wants to achieve by 2003.

In the last session of Parliament it had passed the education fundamental right Bill to give more teeth to the target. The government has promised that by 2007, all children between six and 14 will be in school.

There was, however, some confusion on whether the Rs 1,650 crore was part of the Rs 4,900 kitty or separate from it. While some educationists claimed that the Sarva Siksha Abhiyan allocation was part of the overall allocation for primary education, government officials said it was an additional allotment.

“This is to implement the programme in a mission mode with a clear district focus to provide quality elementary education to children in the age group of six to 14 years,” the finance minister said in his speech. There will be special focus on girls, he added.

The latest Economic Survey has conceded the government’s failure to check the increasing dropout rate among school students, especially girls, at the primary and upper primary levels.

Joshi had lobbied hard with the finance minister for a substantive hike in primary education. But he seems to have succeeded better with the department of women and children, which has been allocated 3 per cent more than elementary education and adult literacy.


New Delhi, Feb. 28: 
The growing army of diabetics in the country will thank finance minister Yashwant Sinha. The customs duty on glucometers and test strips used for blood sugar test has been drastically reduced, from 25 per cent to 10 per cent in today’s budget.

There are 3.5 crore diabetics in India — about 12 per cent in cities and 2.5 per cent in villages. “Every year there is a 10 per cent increase in diabetic patients,” says Dr A.K. Jhingan of the Delhi Diabetes Research Centre.

“We have been campaigning for a slash in customs duty on glucometers and test strips,” Jhingan said.

If the Union budget leaves human resources development minister Murli Manohar Joshi miffed, it will definitely bring some cheer to his colleague C.P. Thakur, heading the Union ministry of health and family welfare. There has been a string of concessions in customs and excise duties on drugs, particularly for those needed in critical illnesses.

Customs duty on anti-cancer drugs has been slashed. So has the excise duty on drugs to combat HIV. Anti-AIDS drugs have so far been out of reach of the common people because of high prices.

The government has been expressing serious concern over the rising graph of AIDS and the National AIDS Control Organisation has been mounting pressure on the health minister for cheaper anti-HIV drugs. These will be available duty-free from tomorrow.

A total of 8 drugs used in the treatment of critical diseases, like cancer, have been exempt from customs duty. The duty has also been taken off the vaccine for immunisation against Japanese encephalitis.

The finance minister underlined that some of these drugs are now produced in the country and proposed a five per cent import duty on them to provide an incentive to manufacturers.

Killer diseases like malaria, kala azar, filaria, dengue and Japanese encephalitis top the list of priority allocation, bagging an amount of Rs 235 crore. The programmes run by the AIDS control organisation have been allotted Rs 225 crore.

Some sections in the health ministry have been complaining that programmes for tackling dengue have not been given enough allocation. The finance ministry seems to have tried to take care of their concern in this budget.

The finance minister has allocated Rs 115 crore to control tuberculosis, followed by Rs 86 crore for blindness and Rs 75 crore for leprosy. The cancer control programme receives Rs 61 crore.

In tune with the government’s added emphasis on the Indian System of Medicine, the Centre has earmarked Rs 4 crore for this sector. Budgetary support to the ISM has been increased by 25 per cent.




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