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Annual Budget 2006: Health And Education Sector Receive A Boost

The main focus of the annual budget that was presented by India’s finance Minster P. Chidambaram would be targeted at achievement of a 10% growth rate//. If this were to be accomplished, it would help in the alleviation of poverty, which is omnipresent accross the entire country. The industrial sector had enabled the country achieve an 8.1% economic growth. Attempts would be made to reduce the financial deficit from the current 4.1% to 3.8% next year.

The provision of incentives to encourage research and development activities, more specifically in the R&D intensive sectors such as drug and pharmaceutical, information technology through appropriate financial and other measures formed an important part of the prebudget discussions.

The provision of seed fund for R&D activities on an annual basis, the extension of weighted deduction benefit to a period of 10 years, the increase in weight from the current 150% to 200% to widen the scope in the drug and pharmaceutical industry, ban on price control imposition and dividend distribution tax on this competitive industry, reduction of the excise duty from 16% to 8% were amongst the other topics discussed.

The Government had promised increased spending on healthcare and education. Consistent with the promise, a corresponding 31% and 22% increase in spending on education and health was sanctioned by the Union Minister. The announcement of this enhancement for these service-oriented sectors is believed to result in the much-sought social development. The total amount of financial resources allocated to these sectors has been fixed at Rs.24, 115 crore (education) and Rs.12, 546 crore (health).

An increased funding for the National Rural Health Mission from the current Rs 6553 crore to Rs 8207 crore has been sanctioned. This would ensure the extension of health care facilities in over 100, 000 blocks in the rural India.

The finance minister has allocated more funding
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