Industry & Economy
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Budget
Backward Regions Grant Fund
Our Bureau
New Delhi
,
Feb. 28
THE Finance Minister, Mr P Chidambaram, has announced the creation of a Backward Regions Grant Fund, with an allocation of Rs 5,000 crore for 2005-06.
During the last Budget, the UPA Government had announced its intention to set up a grant fund for backward districts and had established an Inter-Ministerial Group (IMG) for making recommendations on the subject.
Stating that a lot of thought had been given to the creation of such a fund and the group's recommendations had been accepted, the FM said Rs 5,000 crore would be allocated every year for the next four years to this fund.
He said the IMG had proposed that resources under the new facility will be conditional on Panchayati Raj institutions being properly empowered, including the devolution of functionaries and funds, and that he was happy to accept the IMG's recommendations.
With the establishment of this fund, the Rashtriya Sam Vikas Yojana, envisaged in 2006-07, will be wound up.
Also, in keeping with the NCMP's promise for special economic packages for Bihar, Jammu and Kashmir and the North-Eastern States, Mr Chidambaram announced a slew of measures for these States.
The FM proposes to not only increase the allocation under the State Plan for J&K to Rs 4,2000 crore this fiscal from Rs 3,008 crore in 2004-05, he also plans to grant a special plan assistance to the State.
Besides, the Baglihar hydro power project in J&K has been allocated Rs 300 crore this year and the Udhampur-Baramulla rail line will be implemented as a project of national importance, he said.
Noting that all ministries and departments are required to allocate at least 10 per cent of their plan budget for schemes and programmes in the North-East region, Mr Chidambaram said this would amount to an allocation of Rs 9,308 crore in 2005-06.
Besides, the Kumarghat-Agartala and Lumding-Silchar-Jiribam-Imphal projects will be supported with additional funds outside the Railway Budget, since these will be categorised as projects of national importance. Also, Rs 450 crore has been provided for the development of highways in the North-East region.
For Bihar, the Minister said the State had received special assistance through the Rashtriya Sam Vikas Yojana till now and the transition arrangements under this scheme would continue till 2006-07. Meanwhile, the backward districts of the State will begin to receive assistance from the Fund.
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