2008-09 Budget will fully protect farmers' interests: PM

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New Delhi, Feb.25 : The Prime Minister, Dr. Manmohan Singh, today assured that the interests of the farmers will be fully protected in this year's General Budget scheduled to be announced on February 29.

Without elaborating on the measures to be taken, he told a delegation of farmers and workers from Punjab, who called on him at his residence this afternoon that they would get a fair deal.

Dr. Singh said the UPA Government has taken several measures to improve the conditions of farmers and to bring a turnaround in the agriculture sector. Hundreds of farmers have submitted a memorandum to the Prime Minister to give them a new deal in this budget.

Senior Congress leaders Rajinder Kaur Bhattal and Mohinder Singh, who led the delegation, thanked the Planning Commission for a special package to Punjab for its all round development.

UPA Chairperson Sonia Gandhi said that the minimum support price of almost all the crops have been raised by the Government.

The concerns and grievances of farmers are being addressed with a humane approach and expressed hope that more will be done in the budget, she added.

Meanwhile, the Deputy Chairman of the Planning Commission, Montek Singh Ahluwalia, has made a strong case for a cut in petrol and diesel taxes, while indicating there would be a substantial increase in social sector allocations.

"We have said in the Integrated Energy policy...Please decide on a rational tax policy and once you have a rational tax policy in place, on a medium term basis, under-recoveries of petroleum companies are not feasible," he said.

He said the consumers would have to bear the burden of the increasing crude oil prices.

"I think the consumer will ultimately have to bear the burden otherwise you kill your oil companies and I don't think the government wants to do that," Ahluwalia said, adding that he did not anticipate any easing of prices in the short run.

"So we have to live with the oil prices we have got," he said. World oil prices rose again to near USD 100 a barrel in Asian trade on Monday.

The government decided this month to partly pass on the burden to the consumer by raising petrol prices by Rs.2 and diesel prices by Re 1 per liter

Asked whether he expected a higher allocation for the social sectors in the Budget, to be unveiled later this week, Ahluwalia said "Increase definitely. I am very happy you will find Plan (Annual) shows substantial increase especially in the social sectors."

The Annual Plan for the central ministries form part of the expenditure of the government reflected in the Budget.

However, he did not agree that taxes were on the higher side for kerosene and LPG.

He further said that in any political process the government has to balance different needs of the people.

"We should look at the oil price situation, determine the rational burden of taxation, then superimpose on them some explicit subsidy that you want to give on a targeted basis," Ahluwalia said.

He said the government should be allocating more funds on education, health and rural development.

The Planning Commission Deputy Chairman said the Budget has to give a real thrust to the country's medium term objectives, besides "re-assuring investors that India remains a good and sound investment destination".

Delving into issue of the global economic slowdown, he said Finance Minister P Chidambaram will have a difficult task in responding to short-term challenges, which have not been addressed in the current Five-Year Plan.

"For example when the 11th Plan was approved, we did not have the present perception of the state of the world financial system," he said pointing out that there is a lot of financial uncertainty in the global market.

One of the bigger challenges before the government is to deal with the food prices which are likely to go up next year, he said, adding, "We have to manage the domestic economy in a way that availability of food at reasonable prices is assured."

He said the nation needs to have an effective public distribution system (PDS) for the targeted beneficiaries, a good agricultural production and a strong procurement mechanism to ensure availability of food grains for the PDS.

ANI

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