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Monday, February 28, 2011

Thus reports "The Economic Times” on Union Budget 2011- India

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Indian Government   to sort out environmental issues in time-bound manner – reveals the Union Budget 2011

The government on Monday said all vexed environmental issues hurting infrastructure and mining sectors would be sorted out in a time-bound manner. 

Finance Minister Pranab Mukherjee while presenting the Budget said a Group of Ministers (GoMs) would suggest changes in existing statutes, rules, regulations, guidelines and make its recommendations in a time-bound manner for reconciliation of environmental issues related to infrastructure and mining. 


The GoM, headed by the Finance Minister himself, has been set up to suggest ways of the necessary changes in existing environmental rules and asked to finalise its recommendations within two months. 

The Coal Ministry and Ministry of Environment and Forest have been at the loggerheads over various issues after the latter last year classified 203 coal blocks under 'no go' area, impacting 660 million tonne coal production in a year. 

In the first meeting of the GoM, Environment Minister Jairam Ramesh had assured he would be "positive" towards infrastructure projects. 

As per the Economic Survey, both the coal production and the progress of the country's beleaguered infrastructure sector have been badly hampered due to environmental issues. While more than half of ongoing infrastructure projects are running behind schedule, coal production are hampered to a large extent, forcing bulk consumers to rely on imports. 

"The lower growth in production during the current year is primarily due to environmental restrictions, particularly, application of the comprehensive environment pollution index (CEPI)," the survey said, adding there was an urgent need to streamline land acquisition and environment clearance for infrastructure projects. 
The widening demand-supply gap in coal is set to touch 142 million tonnes next fiscal from 82 million tonne estimated this fiscal, mainly because of the classification of 203 coal blocks by environment ministry as "no-go" zones

Coal Minister Sriprakash Jaiswal, Environment Minister Jairam Ramesh, Home Minister P Chidambaram, Mines Minister Dinsha Patel and Commerce Minister Anand Sharma among others are the members of the ministerial panel.

 Analysts think – The Union Budget -2011 focuses on Farm Sector
In his union budget Finance Minister Pranab Mukherjee has given thrust to improving infrastructure, farmers' development and raising agricultural productivity, say research analysts. 

"Overall, it is a welcome budget for the agriculture sector. There are lots of long term measures proposed in this budget. The finance minister has mentioned about bring urea under nutrient-based subsidy (NBS) regime. Food Security Bill is also to be introduced. The agricultural growth is expected to be 5.5 percent," Prasoon Mathur, senior analyst, Religare Commodities, told IANS. 

Mukherjee, in his budget speech in the Lok Sabha Monday, said the new policy on providing subsidies on fertilisers on the basis of their nutrient composition could soon be extended to urea, one of the most widely used fertilisers. 

Sageraj Bariya, research analyst with Angel Broking , said: "The finance minister has reduced excise duty on micro irrigation systems which augurs well for companies operating in that sector. It will be interesting to see how the government plans to bring urea under the NBS regime." 

Presenting his sixth budget and the nation's 80th, Mukherjee proposed raising of rural infrastructure development fund corpus by Rs.2,000 crore to Rs.18,000 crore and also announced Rs.2,000 crore corpus for creating addition warehousing facilities. 

The government is also considering creation of huge food storage facilities and announced infrastructure status for cold storage sector. 

The minister also announced issuance of tax free bonds of Rs.30,000 crore for infrastructure development covering Warehousing Corporation, National Highway Authority of India and others, while increasing the foreign institutional investors (FII) limit in corporate bonds infrastructure by an additional $20 billion.
Mukherjee also announced creation of Rs.100 crore equity fund for micro finance companies. 

Referring to the increase in credit flow to farmers from Rs.375,000 crore to Rs.475,000 crore, Bariya said the budget is a pro-farmer one. 

According to a research report prepared by Religare Commodities, the interest subsidy for farmers who repay their loans is raised by one percent to three percent thus reducing the effective interest to four percent. 

Referring to the increased allocations for green revolution, cultivation of pulses in rain-fed areas, Rashtriya Krishi Vikas Yojana, encouraging farmers to produce vegetables and oil palm production and others, Mathur said: "With cultivable area almost stagnant it has become imperative to increase farm productivity."
(Original Story from The Economic Times)
 Picture Courtesy : The Hindu
Key Words: environment issues, economic survey, GoM, "no-go" zones, demand-supply gap,  Rashtriya Krishi Vikas Yojna

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