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Finance Minister's Budget Speech - Part 4

Part 3

Ashraya Bima Yojana

55. I am conscious of the short-term impact on organized labour force of the on-going liberalization of the economy. I therefore propose to introduce a new scheme of group insurance viz. "Ashraya Bima Yojana" to extend security cover to such affected workers. The policy will provide compensation of up to 30 per cent of last drawn annual pay for a period of one year to workers who lose their jobs. It is proposed that the policy will initially cover all employees drawing a salary up to Rs 10,000 per month. The four Government owned general insurance companies will administer this policy on a "No Profit No Loss" basis and will announce full details including premium rates of the proposed policy by the end of June 2001.

Small Scale Industries

56. Government's commitment to the Small-Scale sector has been repeatedly demonstrated. A comprehensive policy package for this sector was announced by the Prime Minister on 30, August, 2000.

57. In order to encourage production and employment in this sector, the exemption limit has been doubled to Rs 1 crore from September 1, 2000.

58. The new Credit Guarantee Scheme of August 2000 has been provided budgetary support of Rs 100 crore in the current year. The limit of loan without collateral which was earlier fixed at Rs 10 lakh has been raised to Rs 25 lakh under this scheme. Already 7 banks have entered into an agreement with the Credit Guarantee Fund Trust that has been created to implement the scheme. A credit linked capital subsidy scheme for technology upgradation was launched in October 2000 envisaging 12 per cent capital subsidy. It is expected that loans to the extent of Rs 5000 crore would be made available to the SSI sector over the next 5 years under the scheme.

59. Our small-scale entrepreneurs have proved their competitiveness in providing over 35 per cent of national exports. To enable further new investment and technology upgradation in some of the key export oriented sectors, it is now proposed to dereserve another 14 items related to leather goods, shoes and toys.

Textiles

60. The Government has recently announced a New Textile Policy aimed at preparing industry for the new challenges of global competition. I am happy to announce a textile package comprising the following schemes:

* A scheme for setting up Integrated Apparel Parks is being initiated. This will enable the dereserved readymade garment industry to set up modern units with the best infrastructure. A budget provision of Rs 10 crore has been provided for the year 2001-02.

* A strong and modern weaving sector is very critical for this purpose. At least 50,000 new shuttleless looms and the modernisation of 2.5 lakh plain looms to automatic looms is expected to take place by 2004 through funding from the Technology Upgradation Fund Scheme (TUFS). The budget provision under TUFS is being raised from Rs 50 crore this year to Rs 200 crore in the next year.

* The Cotton Technology Mission is being continued and strengthened. The budget provision is being increased from Rs 15 crore to Rs 25 crore.

* The budget allocation for Ministry of Textiles is being enhanced substantially from Rs 457 crore in 2000-01 to Rs 650 crore in 2001-02.

* I shall provide the details of the proposed fiscal changes in Part B of my speech.

Human Development

Health and Family Welfare

61. Recognizing the need for increasing investments in social sectors, the Plan allocation for the Ministry of Health & Family Welfare has been stepped up from Rs 4920 crore to Rs 5780 crore. This includes an allocation of Rs 180 crore for HIV/Aids Control Programme.

Indian System of Medicine

62. There is now a great interest worldwide in herbal products as people look for gentler forms of treatment devoid of side effects. We are establishing a Traditional Knowledge Digital Library to bring the knowledge already in the public domain in international languages to prevent the grant of patents. We are also introducing a new scheme for strengthening the State Drug Testing Laboratories and pharmacies. We propose to provide Indian Systems of Medicine and Homeopathy benefits similar to the pharmaceutical industry.

Education

63. An integrated National Education Programme - the Sarva Siksha Abhiyan has been launched for universalising elementary education and a National Mission constituted with the Prime Minister as Chairman. The programme aims to provide eight years of quality elementary education for all children up to the age of 14 years in a Mission mode with a thrust on community ownership, disadvantaged group and girls' quality education and alternative modes of education. All existing schemes on elementary education will converge with this scheme after the Ninth Plan and it will cover all districts in the country by March, next year.

64. We are determined to maintain and strengthen our competitiveness in the field of technology education. A task force set up for this purpose under the HRD Minister has made wide-ranging recommendations to upgrade and expand this area of education, The Roorkee Engineering College will be upgraded in to an IIT and funding for IIT, Guwahati has been stepped up to ensure its early completion. The base of IITs is to be expanded, regional engineering colleges are to be strengthened and new institutes will be set up with public private partnership. The role of the private sector will be encouraged. A new Centrally Sponsored Scheme for computer literacy and studies in schools is being launched and other initiatives planned for encouraging IT education from school to college levels.

65. Last year, I announced the availability of 100 per cent deduction from income tax of payments made to institutions for vocational education and training by the private sector set up in rural areas and small towns. I propose to make the same deduction available for payments to engineering institutions also.

Educational Loans for Students

66. Mr Speaker Sir, I have personally experienced poverty and faced problems in pursuing higher studies. I, therefore, feel that no deserving student in the country should be deprived of higher and technical education for want of finances. I am glad that the Indian Banks Association (IBA) has formulated a new comprehensive Educational Loan Scheme, which will cover all courses in schools and colleges in India and abroad. Loans will be available under this scheme up to Rs 7.5 lakh for studies in India, and Rs 15 lakh for studies abroad. No collateral or margin will be stipulated for loans up to Rs 4 lakh, the interest of which will not exceed the prime lending rate (PLR). The interest rate will not exceed PLR plus 1 per cent for loans above Rs 4 lakh. The loans would be repaid over a period of 5 to 7 years with provision of a grace period. I hope that this scheme will enable needy children to pursue higher and technical studies both inside and outside India.

Women

67. The year 2001 is being observed as Women's Empowerment Year. My colleague, the Deputy Chairman of the Planning Commission is heading a Task Force to review the programmes for women. Meanwhile I propose to:

* Strengthen the Rashtriya Mahila Kosh for providing micro credit to poor assetless women through NGOs.

* Launch an integrated scheme for women's empowerment in 650 blocks through women's self help groups.

* Start a new scheme for women in difficult circumstances like widows of Vrindavan, Kashi and other places, destitute women and other disadvantaged women groups.

Scheduled Castes and Scheduled Tribes

68. In keeping with Government's commitment to improve the Welfare of the scheduled tribes, a separate National Scheduled Tribes Finance & Development Corporation with an authorised share capital of Rs 500 crore has been set up. The allocation for the schemes for welfare of scheduled tribes in the Ministry of Tribal Affairs has been enhanced from Rs 786 crore this year to Rs 986 crore in the coming year.

69. Similarly, the allocation for the schemes for welfare and upliftment of scheduled castes in the Ministry of Social Justice & Empowerment has been enhanced from Rs 709 crore this year to Rs 790 crore in the coming year.

Social Security

70. Hon'ble Members may recall my announcement in the last budget, of a new Group Insurance Scheme, the "Janashree Bima Yojana" to extend Social Security cover to the poorest sections of society. The said scheme was launched by the Prime Minister on 10, August, 2000 and has been well received. 332 schemes have been approved so far covering 99,750 people in the BPL segment.

71. I believe that the Social Security cover needs to be widened to minimize the miseries of our people below the poverty line. Accordingly, I propose to introduce two more schemes during the next financial year:

(i) A special scheme for landless agricultural labourers, the Khetihar Mazdoor Bima Yojana, which will provide benefits of insurance cover as available under Janashree Bima Yojana and a pension of Rs 100 per month, to the beneficiary on attaining the age of 60 years. In the case of beneficiaries who join the scheme at a young age, some periodical payments at the end of every ten years are also envisaged. The beneficiaries will be required to make a small contribution towards the premium.

(ii) A Shiksha Sahyog Yojana, to provide an education allowance of Rs 100 per month to the children of parents living below the poverty line, to meet the expenses of education during their studies from 9th to 12th standard, so that a needy student is not deprived of the opportunity to continue his/her education for want of funds. This will be available to subscribers of the Janashree Bima Yojana.

These schemes will be managed by LIC.

72. Meanwhile, I have some good news for workers. The wage ceiling for coverage under the EPF and MP Act, 1952 has been enhanced from Rs 5000 to Rs 6500. To promote the welfare of employees I propose to enhance the ceiling for Government contribution of 1.16 per cent of monthly wage of employees to the Pension Fund from Rs 5000 to Rs 6000 per month. The extra expenditure on this account is estimated to be Rs 77 crore per annum.

73. Whereas the organised sector is at present covered by various pension, provident fund and gratuity schemes, the unorganised sector does not have adequate social security coverage. I am asking the Insurance Regulatory Development Authority to look into all these issues and provide a road map for pension reforms by October 1, 2001.

Continued

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