Since independence in August 1947, the country has seen a total of 25 ministers hold the finance portfolio. It has also seen 81 budgets -- 65 normal annual budgets, 12 interim budgets and four special-occasion budgetary measures, also called mini-budgets.
Among them, Morarji Desai presented eight normal and two interim budgets, which had taken his tally to a record 10 -- this remains unchallenged so far. Thursday will see Chidambaram equal the eight-budget track record of his predecessor, Pranab Mukherjee, who is now president.
The Budget is significant as it would be the last before the general elections due in April-May next year. There can only be an interim budget before the elections.
Chidambaram will be under pressure to earmark funds for schemes and programmes to fulfil electoral promises especially with regard of the Food Security Bill which seeks to provide subsidised foodgrain to poor as a matter of legal right.
The Economic Survey, which precedes the Budget, is not in favour of imposition of tax on super rich, stating that government should focus on widening tax base in preference to raising rates. The final call, however, will have to be taken by Chidambaram.
As regards salary earners, they may get some relief with the Minister likely to raise the income tax exemption limit, which is currently at Rs 2 lakh per annum. The Parliamentary Standing Committee on Finance had suggested that the limit be raised to Rs 3 lakh and other slabs adjusted to provide relief to people reeling under the impact of high inflation.
Chidambaram is also expected to tweak schemes like Rajiv Gandhi Equity Savings Scheme (RGESS) to encourage individuals to invest surplus funds in stock markets. The effort would be to do away with grey areas and make schemes more attractive to first time investors.
The main task before Chidambaram would be to arrest declining growth, which is likely to fall to 10-year low of 5 percent in 2012-13. The contracting industrial production too will require the Minister's attention.
The Survey has indicated that growth in the next fiscal could be in the range of 6.1-6.7 percent.
The Finance Ministry may also announce steps to raise tax and non-tax revenue and cut expenditure to keep fiscal deficit under check.
On the taxes front, Chidambaram is likely to incorporate some of the provisions of the Direct Taxes Code (DTC) in the tax proposal, besides, announcing a roadmap for implementation of the Goods and Services Tax (GST).
As regards disinvestment, the Minister is likely to raise the target to Rs 40,000 crore for 2013-14, from Rs 30,000 crore budgeted for this fiscal. However, the government may raise only Rs 27,000 crore in the current fiscal.
While attributing declining growth to global and domestic factors, the Survey underlines the need for policy actions to spur growth.
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