• The Twin Deficits
• Gross Domestic Product
• Financial Sector
• Changes in Tax Rates
• Economic & Social Initiatives
• Other Initiatives
Vote on Account 2014 2
A vote-on-account /interim budget was presented instead of a full budget because
general elections will be conducted in May.
Vote-on-account deals only with the expenditure side of the government's budget.
The government gives an estimate of funds it requires to meet the expenditure that it
incurs during the first three to four months of an election financial year until a new
government is in place.
A vote-on-account cannot alter direct taxes since they need to be passed through a
The common feature is that both include the previous year's financial performance of
Vote on Account 2014 3
The Twin Deficits
• Fiscal Deficit - When a government's total expenditures exceed the
revenue that it generates (excluding money from borrowings). It is usually
communicated as a percentage of its gross domestic product (GDP).
• CAD - A measurement of a country’s trade in which the value of goods and
services it imports exceeds the value of goods and services it exports.
• The current account also includes net income, such as interest and
dividends, as well as transfers, such as foreign aid.
Vote on Account 2014 4
The Twin Deficits - Figures
Fiscal deficit for 2013-14 is at 4.6% of
the GDP, well below the target of 4.9%.
It is estimated to be 4.1% for FY15.
Current Account Deficit stood at $45
billion dollars as against $88 billion
dollars in FY14.
$15 billion dollars is expected to be
added to the foreign exchange reserves
by the end of this FY.
Vote on Account 2014 5
The Foodgrain production stood at 263 million
tonnes current year as against 255.36 million
tonnes last year.
Agriculture exports in FY14 is likely to cross USD
45 billion mark versus USD 41 billion last year.
Agriculture GDP growth is estimated at 4.6% this
year as against 4% in the last four years.
Vote on Account 2014 8
Due to high interest cost
and stalled projects
in 1Q14 whereas
improved in 2Q14.
The savings rate was
31.3% in FY12 and
30.1% in FY13.
Vote on Account 2014 9
The National Manufacturing Policy has
set the goal of increasing the share of
manufacturing in GDP to 25% and
create 100 million jobs over a decade.
8 National Investment and
Manufacturing Zones along the Delhi-
Mumbai Industrial Corridor and 5
outside it have been given approval.
Vote on Account 2014 10
Gross Domestic Product
The monetary value of all
the finished goods and
services produced within a
country's borders in a
specific time period.
It includes all of private and
investments and exports less
imports that occur within a
GDP = C + G + I + NX
"C" is equal to all private consumption, or consumer spending, in a nation's economy
"G" is the sum of government spending
"I" is the sum of all the country's businesses spending on capital
"NX" is the nation's total net exports, calculated as total exports minus total imports. (NX = Exports - Imports)
Vote on Account 2014
Gross Domestic Product - Figures
Growth in Q2 of FY4 has been placed at 4.8% and growth for the
whole year has been estimated at 4.9%.
Some policy announcements pertaining to the curb on gold
imports, quick clearance of investment proposals, relaxed ECB
norms and relaxation in the FDI limit for asset reconstruction
companies may have yielded some positive results.
India’s slow growth, however, is in sync with the pace of growth
in other BRICS countries.
Vote on Account 2014 12
• Propose to provide Rs.14,000 crore for capital infusion in public sector banks.
• The Bharatiya Mahila Bank was inaugurated on 19.11.2013.
• Rs.6,000 & Rs.2,000 crores have been provided to Rural & Urban Housing Funds.
• LIC & 4 public sector general insurance companies have opened around 3000 offices
in towns with a population of 10,000 or more to serve urban & rural areas.
Vote on Account 2014 14
Changes in Tax Rates
There are no changes in personal and corporate income
Excise duty rate structure on mobile handsets, including
cellular phones has been restructured.
General excise duty rate on all machinery, equipment,
appliances etc has been reduced from 12 per cent to 10
Excise duty rates on motor vehicles (motor cars, motor
cycles, scooters, commercial vehicles, trailers etc) have
been reduced by 3 per cent to 6 per cent, depending
upon the nature and configuration of the motor vehicles.Vote on Account 2014 15
One Rank One Pension for our soldiers.
The expenditure on Education has reached Rs.79,451 crores from Rs.10,145 10 years ago.
Expenditure on Health & Family Welfare has reached Rs.36,322 crores from Rs.7,248 10 years ago.
Gender Budget & Child Budget has Rs.97,533 crores & Rs.81,024 crores.
Rs.48,638 crore & Rs.30,726 crore are allocated to SC Sub-Plan & Tribal Sub-Plan.
Railways support budget increased from Rs.26,000 crores in 13-14 to Rs.29,000 crores in 14-15.
Vote on Account 2014 17
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