Under the Bharat Nirman initiative, by 2009, to bring an additional one crore hectares under assured irrigation.
About 1.2 m hectares have been covered under micro-irrigation so far, and the plan is to increase the coverage to 3 m hectares by the end of the Tenth Plan and to 14 m hectares by the end of the Eleventh Plan. Accordingly, additional Rs 4 bn for promoting micro-irrigation in 2005-06 is provided.
Fertiliser subsidy bill estimated for 2005-06 at Rs 162.5 bn (from Rs 156.6 bn as per the revised estimate for 2004-05).
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The outlay under the Accelerated Irrigation Benefit Programme (AIBP) has been increased from Rs 45 bn last year to Rs 71.2 bn in FY07, with the Central Government supporting the programme with a grant of Rs 23.5 bn. An additional 600,000 hectares of irrigation potential are expected to be created in FY07.
The target for farm credit has been raised from Rs 1,415 bn in FY06 to Rs 1,750 bn in FY07, with the addition of 5 m farmers envisaged.
Farmers to receive short-term credit at 7%, with an upper limit of Rs 300,000 on the principal amount.
Customs duty on natural gas has been reduced from 10% to 5%.
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Proposals to improve the economic viability of farming
Government to offer seed producers a grant or concessional financing in order to double the production of certified seeds within a period of three years
Pass through status to venture capital funds in respect of investments in venture capital undertakings in seed research and development
Implementation of a pilot programme in at least one district in each state to find a method of delivering the fertiliser subsidy directly to the farmers
Hike in the dividend distribution tax from the current 12.5% to 15%
A secondary and higher education cess @ 1% of the aggregate of duties of excise has been imposed on excisable goods. This would be in addition to existing education cess of 2% imposed in budget 2004
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