ECONOMIC SURVEY

The Economic survey presented by the Finance Ministry in parliament today focuses
on containing the fiscal deficit to 3% of GDP and reviving the GDP growth to 7-7.5%
from 6.7% in 2008-09. Some of the policy measures suggested in the survey are as
follows:
Highlights:

Revitalize the disinvestment program and plan to generate at least Rs. 25,000
crore per year.

Selling 5-10% of equity in profitable non-navratnas.

List unlisted public sector undertakings by offloading at least 10% of equity to
the public.

Auction loss-making public service undertakings.

Raise FDI in insurance to 49%

Allow FDI in multi-brand retail

Raise FDI limit in defence industries to 49% from 26%.

Allow 100% FDI in health, weather insurance

Rationalise Dividend Distribution Tax

Remove Commodity Transaction Tax, Securities Transaction Tax, and Fringe
Benefit Tax

Phase out tax surcharge, cess, and transaction tax

Introduce new income tax code

Decontrol sugar and fertiliser industry.

Decontrol petrol and diesel prices.

Cut oil, fertiliser, food subsidy leakages

Auction spectrum and make it freely tradeable.

Separate telecom license from spectrum allocation.

Review customs duty exemptions and move to a uniform duty structure

Drug price control should be limited to essential drugs in which there are less
than five producers. All others should be decontrolled.

Limit LPG subsidies to 6-8 cylinders per year per household.
The economic survey focuses on measures to revive growth and to contain mounting
fiscal deficit. Going forward how the government is going to implement them in the
upcoming budget will determine the direction of the market.