budget 2011(full final)

8/7/2019 Budget 2011(Full Final)

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Budget 2011

(Service Sector)

Prepared By:

Manoj Chejara

Sagar Pandey

Vijaykumar Gupta

Pankaj Panchmukh


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Union Budget:

Pranab Mukherjee's budget speech was 80th in India's history

1st Union Budget -- R K Shanmukham Chetty; 26th nov,1947.

12.58-trillion rupee ($273.4 billion) budget

Mr. Mukherjee expects:

Net revenue loss of115 billion rupees from changes in direct taxes Net revenue gain of113 billion rupees from amendments to indirect

taxes

The overall net tax revenue is likely to be 6.64 trillion rupees.


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OVERVIEWOFTHE ECONOMY

Gross Domestic Product (GDP) -- 8.6 per cent growth rate in 2010-11

Continued high food prices have been principal concern this year.

Consumers denied the benefit ofseasonal fall in prices despiteimproved availability of food items, revealing shortcomings in

distribution and marketing systems.

Monetary policy measures taken expected to further moderate

inflation in coming months.

Exports have grown by 29.4 per cent, while imports have recorded a

growth of17.6 per cent during April to January 2010-11 over the

corresponding period last year.


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Total Receipts/Expenditure

Revenues

Earnings

Tax Revenue

Non-Tax

Reven

ue

Borrowings

Debt Receipts

Capital

Receipts

Non-DebtReceipt

Expenditure

LeakyExpenditure

Subsides

Defense

Central Planoutlay

Others

Non LeakyExpenditure

Grants toStates/UT

Assistance to

State Plan

s

InterestPayments


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Service Sector

India stands out for the size and dynamism of itsservicessector

Contribution :55.2% share in GDP

Growing by 9% annually

Contribute quarterof total employment

Accounting for a high share in foreign direct investment (FDI)inflows

Overone-third of total exports ; (27.4%) export growth throughthe first half of 2010-11.

Servicessector likely to register9.6% growth ;despite globaldeceleration

Indian economy 2nd fastest growing in the services growthwith 8.9% , behind china (10.5 per cent).


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Statistical Data:


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Services Category:

Transport Services:

Shipping

Port Services

Storage Services

Business Services: I.T

Accounting & Auditing services

R & D

Legal Services

Consultancy

Social Services:

Healthcare

Education

Sports

Tourism Hotels & Restaurants

Telecom & Related Services

Real Estate Services


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Service Sector (9%) Trade, hotels, transport, and

communication (11%)

Financing, insurance, real estate, and

business services (10.6%) Community, social and personalservices (5.7%)

Construction sector (8%)

IT BPO services (19.5)

Domestic IT related services (22.8%)

Growth Rate


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Source : Economic Survey 2010-11


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FDI ( Foreign Direct Investment)


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Service Tax:

Hotel accommodation in excess of Rs1,000 per day

Standard rate retained --- Seeking closer to its GSTsuccessor.

Proposals estimated to result innet revenue gain of Rs 4,000 crore.

Tax on all services provided by hospitals with 25 or more beds with facility of

central air conditioning.

Service Tax on air travel both domestic and international raised.

Services provided by life insurance companies in the area of investment and

some more legal services proposed to be brought into tax net.

All individual and sole proprietor tax payers with a turn over upto Rs 60 lakh

freed from the formalities of audit.


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Exemptions:

Business exhibition service - - exhibition held outside India will beexempt.

Abatement of 25% -- on transport of goods through coastal andinland shipping

Works contract service -- JawarhlalNehru National Urban RenewalMission & Rajiv Awaas Yojna

Services provided to Rashtriya Swasthya Bima Yojana under GeneralInsurance.

Modified scheme for refund ofservice tax to SEZ units anddevelopers which will supersede the earlier notification


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Banking:

SBI to get the freedom to reduce itsstake in itssubsidiaries to 51%

Microfinance companies may see better fund flow

PSU banks to get capital support ofRs 6,000 cr

India banks on IT to reboot key projects

RBI to issue guidelines on new banking licenses

Stocks to Watch Out:

SBI, Axis bank, Yes Bank, Oracle Financial Ser-vices


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Education:

100% hike in Anganwadi workers' wages Education gets 24% hike in budget allocation

The allocation for Right to Education was

meanwhile hiked by 40 percent. The Indian Institute ofTechnology ,Kharagpur

will get Rs.200 crore as a one-time grant.


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Telecom:

Telecom sector is one of the fastest growing sectors in India--- Compound annual growth of34% over the last decade ---

India as already reac ed t e 500 million subscriber-base

Telecom sector revenue at Rs 29,648.33 cr

Telecom companies disappointed at 'discouraging' budget

3G, broadband wireless access frontiers for growth

Telecom revolution yet to reach over62,000 villages


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Transport

Airlines to pass on service tax increase

Air India to get Rs1,200 cr fresh equity

Northeast to get Rs93 crfor airport development

Cos cheer Mamta's decision not to hike freight rates


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Infrastructure:

Budgeted spending -- Rs2,14,000cr-- hike of over23% from Rs

1,73,000cr during 2010-11.

Allocation forBharat Nirman is proposed to be increased by Rs.

10,000 crore over the current fiscal at Rs.58000 cr

Allocation for infrastructure stands at 48.5% of Gross Budgetary

Support to plan expenditure

Tax Free Bond of Rs.30000crto boost infrastructure development

in railways, ports, housing and highways.


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Media & Entertainment:

Relief for cinema industry as film rolls getsduty rebate

Prasar Bharti's budget decreased

Media cosseekhigherFDI, lower taxes to aid growth

Future of entertainment: Web Integration with TV

BCCL forms JV forTV channels distribution


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budget 2011(full final)

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