India just passed its Interim budget for 2009/2010. Obviously this is a special budget as the country will have elections in a few months so there are very few drastic changes. Highlights of the budget courtesy the Indian Consulate is below:
Background
• India remains the second-fastest growing economy in the world
• Economy expected to grow 7.1 percent the fiscal year April 2008 - March 2009
• Domestic investment rate as a proportion of GDP increased to 39 percent in 2007-2008
• The gross domestic savings rate increased to 37.7 percent between 2003-04 & 2007-08
• The tax to GDP ratio increased to 12.5 percent between 2003-04 and 2007-08
• During this four year period between 2004-05 and 2007-08, the annual growth rate of agriculture rose to 3.7 per cent.
• Manufacturing recorded a growth of 9.5 per cent per annum between 2004-05 & 2007-08
• Communication sector grew at the rate of 26 per cent per annum
• Construction sector grew at the rate of 13.5 per cent per annum
• India’s exports grew at an annual average growth rate of 26.4 per cent in US dollar terms during this period. Foreign trade increased from 23.7 per cent of GDP in 2003-04 to 35.5 per cent in 2007-08.
• Inflation rate fell to 4.4 per cent on January 31, 2009
Outlook for April 2008- March 2009
• Government accorded approval for 37 infrastructure projects worth Rs.70 thousand crore (US $14.3 billion) in 2008-09.
• Under public-private partnership (PPP), 54 central infrastructure projects approved with total expenditure of projects estimated at Rs.67,700 crore (US $ 13.8 billion)
• India Infrastructure Finance Company to raise Rs.10,000 crore (US $ 2 billion) by end-March 2009 to refinance 60 per cent of commercial bank loans for PPP projects in critical sectors over the next eighteen months or so.
• During 2007-08, a record US $ 32.4 billion of FDI was received. Inward FDI flows during April-November 2008 were US$ 23.3 billion, representing a growth of 45 per cent over the same period in 2007.
