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Yeddyurappa presents a budget with promises to keep

S. Rajendran

Nationalised banks to give farm loans at three per cent interest rate

— Photo: Bhagya Prakash K.

FOURTH IN A ROW: Chief Minister B.S. Yeddyurappa saying a prayer as he arrives to present the State budget at the Vidhana Soudha in Bangalore on Friday.

BANGALORE: Faced with an election around the corner and a revenue crunch owing to a severe slowdown, Chief Minister B.S. Yeddyurappa has presented a budget for 2009-10 that is strewn with promises.

For the farm sector, Mr. Yeddyurappa, who holds the Finance portfolio, announced that farmers will be eligible for loans at a subsidised rate of three per cent interest from nationalised and commercial banks.

Mr. Yeddyurappa said: “From 2009-10, farmers will be able to get crop loans up to Rs. 50,000 from commercial banks at a concessional rate of three per cent interest. A sum of Rs. 400 crore has been provided in the budget for interest subsidy for farm loans. Hitherto, farm loans at a subsidised rate of three per cent interest were being extended only by cooperative banks. Yet another scheme for farmers is a foreign study tour, apart from an impetus to organic farming at a cost of Rs. 100 crore.”

A reduction in stamp duty on sale transactions for all kinds of immovable property, including agricultural lands, lower entertainment tax on cinema tickets, reduction in value added tax of a few commodities and reduction in tax for electricity-driven motor vehicles are some of the other tax proposals in the budget.

The budget presents a surplus of Rs. 1,151.37 crore on the revenue account and a deficit of Rs. 1,237.25 crore in the capital account. The overall deficit is estimated at Rs. 85.88 crore, and with the revised estimates for 2008-09 showing a surplus of Rs. 42.80 crore, the closing balance shows a deficit of Rs. 43.08 crore.

The budget also indicates a 33.3 per cent increase in the State’s annual plan size — from Rs. 22,118 crore (revised estimates for 2008-09) to Rs. 29,500 crore (budget estimates for 2009-10).

The Government will set up electronic public call offices to popularise the use of the Internet in rural areas and bio-tech parks in prominent cities, away from Bangalore. The Government will set up apparel clusters in Gulbarga, Bellary, Hubli, Belgaum, Bagalkot, Shimoga, Davangere, Mysore, Ramanagaram and Chickballapur with private participation. Under the scheme, the Government will extend 20 per cent share capital to each of the clusters, for which about Rs. 40 crore to Rs. 50 crore investment is required.

In his post-budget meeting with presspersons, the Chief Minister said: “Like the previous budgets, this budget is farmer friendly and rural development centred.”

Though the Chief Minister claims that this is a “farmer-centric” budget, the allocation for agriculture and allied sectors has declined sharply in comparison to the previous year from Rs. 2,491.63 crore to Rs. 2,122.13 crore. In terms of overall allocations too, the share of this sector has fallen from 9.6 per cent to 7.19 per cent. The allocation for rural development and education shows a similar decline.

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