Presenting the budget 2010 for India, Pranab Mukherjee had to balance the fiscal deficit without jeopardizing growth.

The stimulus in the union budget being a dent in the government’s accounts, it was always argued that it should be removed in a phased manner. Economic Advisory Council’s report advised that an allocation of 1.5% in the union budget was safe.

The union budget 2010 which was presented today saw the FM bring a hike in the excise duty from 2% to 10 %.

There was a reduction in the personal tax rate saving of Rs 50,000 up to Rs 8 lakh income in the union budget 2010-2011.

The union budget 2010-11 saw a reduction in the personal tax rate saving from Rs 50,000 to Rs 8 lakh income.

Fiscal deficit vs. stimulus in the budget 2010

The envious industrial growth saw an industrial output of 16.8 % in December but at the same time, the inflation sky rocketed to 8.56 %.

Amit Mitra, the secretary general at Ficci was of the opinion that India was still in the need of govt. hand in the in the budget and removal of the stimulus packages might lead to a decline in the growth story. But most of the industry leaders felt that there should be a well planned removal starting from budget 2010 of India.
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Extent of stimulus in the budget 2010

India being the third largest economy in Asia did well to reduce the impact of the global economic crisis by recapitalizing the state banks to around USD 4.1 billion and easing the rules in terms of foreign borrowing for infrastructure and real estate.  Government had announced up to three fiscal stimulus packages between December 2008 and February 2009 mentioned in the union budget 09-10.