Highlights: Economic Survey

New Delhi: Following are the highlights of the pre-Budget Economic Survey: 2008-09.

• Unleash reforms – phase out cesses, surcharges and transaction taxes (such as commodities transaction tax, securities transaction tax and Fringe Benefit Tax)
• Introduce new Income Tax Code that results in neutral corporate tax regime.
• 7-7.5 per cent growth possible in 2009-10.
• Allow 49 per cent FDI in defence and insurance; permit FDI in multi-format retail starting with food.
• Proposes another round of fiscal stimulus including tax cuts and increase in expenditure.
• Decontrol petrol and diesel prices; end Government monopoly in railways, coal and nuclear energy.
• Lift all bans on future contracts to restore price discovery; decontrol sugar and fertiliser.
• Revitalise disinvestment programme to generate Rs 25,000 crore annually, list all PSUs and auction those beyond revival.
• Economic growth decelerated in 2008-09 to 6.7 per cent from nine per cent in 2007-08.
• Fiscal deficit in 2008-09 shot up to over 6 per cent from 2.7 per cent in 2007-08.
• Survey indicates FRBM-II to get back to path of fiscal consolidation.
• Complete the process of selling 5-10 per cent equity in identified profit-making non-'Navratna' PSUs.
• List all unlisted PSUs and sell a minimum 10 per cent equity to public.
• Auction all loss-making PSUs that cannot be revived.
• In PSUs with zero networth, allow negative bidding in the form of debt write-off.
• Auction 3G spectrum.
• The auctioned spectrum must be freely tradable, with capital gains on spectrum to be taxed under the Income Tax Act.
• Rationalise Dividend Distribution Tax to ensure full single taxation of returns to capital in the hands of the receiver.
• Reform petroleum (LPG, Kerosene), fertiliser and food subsidies to reduce leakages and ensure targeting.
• Limit LPG subsidy to a maximum of 6-8 cylinders per annum per household.
• Phase out kerosene supply-subsidy by ensuring that every rural household has a solar cooker and solar lantern.
• Review Customs duty exemptions and move to a uniform duty structure to eliminate inverted duties.
• Implement GST from April 1, 2010.
• Rapid operationalisation of UID Authority within three months.
• Agriculture growth fell sharply to 1.6 per cent in 2008-09 from 4.9 per cent.
• Exports grew at 3.4 per cent to 168 billion dollar in 2008-09 from 163 billion dollar in previous fiscal.
• Imports grew at 14.3 per cent to $287.75 bn from $251.65 bn.
• Trade balance deteriorated to $119.05 bn from $88.52 bn.