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Karnataka Budget 2008-2009

that its online within a week is pretty awesome. now time to dig into it and understand what it says and where the money goes. folks who know economics please help understand.
tsubba's picture

Budget Highlights

Pro-farmer Budget
Speedy Development is administrative mantra.
Priority for equal Development of all areas.
Economic Development with Social development.
Continuation of pro-people programmes of the previous coalition Government.
Desire to develop Karnataka as a model state.
Blue Print for Comprehensive Development 2020.

Economic Scenario fo 2007-08
  • GSDP as 2,15,282 crore rupees
  • 7% GDP growth during 2007-08.
  • Percapita income during 2007-08 at Rs.39576.
  • States total debt at Rs.60588 Crores
  • 2007-08 debt servicing Rs.6018 Crore
GSDP contribution
  • Primary Sector 19.13%
  • Secondary Sector 25.16%
  • Service Sector 55.72%
2008-09 Budget at a  Glance
  • Total estimate Rs.55,313.41 Crores
  • Revenue Expenditure Rs.45,712.86 Crores
  • Capital Expenditure Rs.9,600.55 Crores.
  • Plan Estimate Rs.25,953 Crores.

  • Norms based grant-in-aid to High schools started in 1993 and 1994.
  • Rs. 958 Crores assistance to Sarva Shikshana Abhiyana.
  • Free bycicles to 7 lakh eigth standard children studying in Government and Aided Schools.
  • Rs. 55 Crores to upgrade 37 ITI's
  • Establishment of ITI's in 9 taluks.
  • 6% interest subsidy to students who borrow loan for higher studies.
  • Boarding expenses to SC/ST & BCM Hostel students will be increased from Rs. 450/- to Rs. 650/-.
  • In order to improve quality of education, Karnataka Knowledge & Higher Education Commission will be constituted.
  • Rs. 2 Crores will be provided to establish Sanskrit University in Bangalore.
  • Establishment of Agriculture University in Bagalkot & Raichur.
  • Rs. 25 Crores will be provided for development of KIMS in Hubli.
  • To encourage establishment of private universities in the State.

  • From August 1, free electricity to 15 lakh irrigation pumpsets upto 10 H.P.
  • 50 lakh small and marginal dry land former families will get grant of Rs.1000 each per family.
  • Subsidy of Rs.2 per litre to Milk Producers.
  • Rs.500 Crores towards agriculture revolving fund.
  • Agricultural loan at the rate of 3% will be extended  to weavers and fishermen too.
  • Constitution of “Agriculture Mission” under the chairmanship of Chief Minister for the over all development of the agriculture and agricultural alied activities.
  • Special Commission to encourage organic farming.  A grant of Rs.2000 will be provided to every family who practices organic farming.
  • Scheme for rejuvination of all 36,000 tanks in the state as per salasamvardhana model
  • Establishment of special Authority for maintainance of Water resources and framing rules
  • Suitable Act for better Ground Water Management.
Removal of Imbalance
  • Special assistance of Rs. 2547 Crores for redressal of regional imbalance.
Gram Panchayat
  • Monthly honorarium to 90,000 Gram Panchayat Members.
  • Cyber centers at Grampahcnayat level.

To provide emergency treatment for the poor, ‘Mobile treatment unit’ and Call Centres under the ‘Health Cover Scheme’ will be started with private participation.
‘Thayi Bhagya’ Scheme in public and private hospitals for maternity facility.

Social Welfare:
  • Pension through Smart Card to physically challenged, widows and aged.
  • Special Development programme for Koraga community
  • Rs. 20 Crores grant provides to Kambara, Kshatriya, Madivala, Devanga, Kumbara organisations etc.,
  • Rs. 15 Crores grant for construction of Shadi Mahal for minority communities
Women Welfare
  • Increase of benefit in "Bhagyalakshmi" Scheme to Rs. 1 lakh
  • 6% interest subsidy to stree shakthi groups
Physically challenged
  • Pension of Rs. 1000/- P.M. to physcially challanged persons with 75% disability.
Senior citizens
  • Concession of 25% to senior citizens who are 65 years of age and above in bus fares.
Child Development
  • Establishment of Balvikas Academy for allround development of children.

  • Increase of unit cost of Ashraya houses to Rs. 40000 to each house.


Bangalore Infrastructure Development
  • Rs. 1800 Crores for Bangalore Infrastructure Development
  • Formation of 60000 sites by BDA in the Nada Prabhu Kempegowda Extension.
  • Construction of 10 Flyovers and underpasses in the Bangalore Outer Ring-road for smooth traffic at a cost of Rs. 350 Crores.
  • Construction of peripheral ring-road at a cost of Rs. 3000 Crore under public private partnership.
  • High speed Rail for Bangalore International Airport.
  • A grant of Rs.700 crores for Metrol Rail
  • Multistoried car parking at 40 places in Bangalore under public private partnership.
Rest of the State
  • Special Development Plan of Rs. 700 Crores for the development of Hubli-Dharwar, Belgaum, Gulbarga, Davanagere, Bellary, Mysore and Bangalore City Corporations. A grant of Rs. 175 Crores during this year.
  • An assistance of Rs. 136 Crores for providing drinking water to Hubli-Dharwad City.
  • Improvement of Karwar Port under Public-private participation.
  • An amount of Rs. 12 Crore for the development of Malpe Fishing Harbour.
  • Constitution of  "Karavali Karnataka Development Authority".
  • In order to improve the transport facilities in rural areas, grant of Rs. 50 Crores to NWKRTC.
  • Establishment of Karnataka Minorities Board.
  • 1000 MW additional power generation in this year.
  • In order to establish an International Airport at Hubli, 700 acres of land and for the development of Belgaum Airport 370 acres of land will be acquired.

  • Guage conversion of Shimoga-Talaguppa Railway line.
  • Construction of new Railway Line between Bidar-Gulbarga.
  • Guage conversion of Solarpur-Bagalkot Gadag Railway Line.
  • Doubling of Bangalore-Ramanagar Railway Line.

Commerce & Industries:
  • Action to formulate New Industrial policy.
  • "Samrudha Karnataka" global investors meet in Jan 2009.
  • Formation of "Vision Group" for overall development of the state.
  • Establishment of steel Zone, cement Zone, Textile Zone on the basis of natural resources available in the state.
  • Establishment of "Skill development Commission" for the first time in the state.
  • Skill training for providing employment to ten lakh persons in the next 5 years
  • One lakh employment creation this year.

Kannada and Culture
  • Rs.5 Crore for Dr. Rajkumar Memorial
  • Rs.5 Crore for establishment of four Suvarna Karnataka Bhavans at regional level
  • Rs.25 Crore assistance for Vishwa Kannada Sammelana to be held at Belgaum
  • Construction of Suvarna Vidhana Soudha at Belgaum and preparations for Legislative session.
  • Establishment of Non-resident Kannadiga (NRK) Cell
  • Rs.1 Crore for K.P. Poornachandra Tejasvi Research Centre
  • Rs.1 Crore for development of Shivayogi Shishunala Shariff’s Chair
  • Rs.1 Crore for development of Sangaolli Rayanna Memorial
  • Rs.1 Crore for Bada village (Kanakadasa Birth Place) – improvement in Haveri District
  • Rs.1 Crore for improvement of Vignaneshwara Garden and Rangamandira at Marthur in Gulbarga district.
  • Rs.5 Crore for commencement of Swamy Vivekananda Centre at Mysore
  • Rs.25 Crore for Tricentenary celebration of Gur-ta-Gaddi and development of infrastructure at Bidar

  • Rs.10 Crore assistance for celebrating Mysore Dasara as Nada Habba on a grand scale

Forest and Environment
  • Special Task Force for protection of Western Ghats
  • New plan to grow more sandal wood trees in the State
Government servants
  • Retirement age of Government servant increased from 58 to 60 years
Administrative Reforms
  • High Power Committee under the Chairmanship of Chief Minister will be set up for overall development of State, Bangalore and other
Information Highways
  • Information highways linking Vidhana Soudha with district and taluka level offices to be completed this year.

  • Disposal of 25 lakh podi cases under "Tatkal Scheme" in Revenue Department.
  • Constitution of a committee for survey and proper utilization of Muzrai and wakf properties.
  • Rs. 20 crores for development of Basavakalyan.
  • Rs. 10 crores for development of Kaginele.
  • Rs. 25 crores for the upliftment of Banjara Community.
  • Establishment of "Karnataka Public Land Corporation" for disposal of valuable Government land.
Commercial Tax
  • Tax on all kinds of parts including packing materials used by textile industry reduced  to 4%.
  • Tax exemption on imported textiles
  • Entry tax on readymade garments exempted.
  • VAT on sale of used motor vehicles reduced to 4%.
  • VAT on vermicelli reduced to 4%
  • Provision for filing appels against revision orders of the Joint Commissioners before the Karnataka Appellate Tribunal.
Sales Tax
  • Partial round of Sales Tax paid on ATF purchased in centers other than Bangalore and Mangalaore.
Luxury Tax
  • 20% luxury tax on conference halls in hotels and marriage halls.
Entertainment Tax
  • Tax exemption on all kannada films excluding dubbed films
State Excise
  • Issue of licences for opening new retail shops (CL-2) and Bar & Restaurants (CL-9)
Stamps & Registration
  • Collection of Duty through electronic stamping extended to other parts of the state.
  • Stamp duty on merger and reconstruction of companys reduced from 7.5% to 5% of the market value of properties.
  • Formation of enforcement wing to prevent stampt duty evasion.
Motor Vehicle Tax
  • Life Time tax on motor vehicles excluding two wheelers increased
Forest Development Tax
  • Collection of Forest Development Tax from licencees mining in forest areas.

tsubba's picture

mining & movies

says ... Collection of Forest Development Tax from licensees mining in forest areas. this has got to be interesting. hope this means large tracts of chamarajanagara and the hills and the malnad are out. hope this does not mean large scale manipulation and fudging of records and de-classification of forest lands. hmm... kannada movies get tax exemption. jayamala and ilk have got to be happy. and hopefully this is seen as free rope to expand range and rediscover the kanagal. hope this is not the rope that is long enough for KFI to hang itself with. hopefully this doesnot mean free run for useless morons like ravichandran and s. narayan. kasarvalli et all have been raising voices against distribution problems. hopefully this will begin to address that.
kbsyed61's picture

BDA Sites and less government arguement !

" Formation of 60000 sites by BDA in the Nada Prabhu Kempegowda Extension."

This is one of the highlights of the Yeddi's budget. Recently there were lots of comments flying back & forth in favor of less government. In the face of that arguement, do the government needs to be in business of selling housing plots/sites? Isn't it the BDA one of the hotbed of corruption corridors in B'lore? Isn't time BDA is stripped of its function of layout formation and sale of sites? If less is the mantra, BDA should be left to regulate the real estate development?


tsubba's picture

BDA Sites

hmm thats interesting. you are saying BDA do the planning, where the roads go, where the pipes(water,sewage) go, where the parks go, where the schools go, community centers go, and let private-walas build the houses. or are you saying, private-walas go all the way? direct from farmer/landowner/villager. well, that way the mess called as whitefield will repeat no?
kbsyed61's picture

BDA sites and our ideals !


 We may not like it but it is a reality. We love BDA sites because it is cheaper than market rate and comes with all the basic amenities (or atleast a promise) and this has good re-sale potential. It is cheaper because, govt pays the less than market value to most vulnerable section of the society, i.e. farmers and small farmland owners. We are not against BDA, because we can manipulate (recommendation/bribe) with BDA babus and politicians to garner the prize hoolding in the Bangalore.

 Now lets come back to our ideals that we are preaching on Praja and other forums. We are saying, there should be competition, price to be determine by Market and govt should withdraw from all its functions except for regulation and policy making. We do not want our tax to be spent on education, health and social support to weaker section of th e society. 

In the face of such ideals, what is our stand against BDA w.r.t its function of land acquisition at cheaper rate, layout formation and selling to NOT-NEEDY. What is our stand against BDA culture of corruption at each and every step of site allotment process.

Just because we are owning one such site, should we still continue our patronage to BDA and its culture of corruption?


tsubba's picture

BDA & the markets

very good point syed. you are absolutely right. somehow the issue of farmer's compensation only crops up wrt industrial and infrastructural projects, it never surfaces when the issue is layouts. i guess layouts are seen as benefitting people, while industries and infrastructural projects are seen as benefitting businessmen, contractors and politicians. even though industries generate jobs for people and businessmen, contractors and politicians benefit even in cutting layouts. lot of duplicity in this issue. now back to these new BDA layouts, they have announced some new compensation schemes. apart from money, the landlosers are supposed to get multiple sites in the newly formed layouts. obviously, they cannot live in all the given sites. and one is meant to be sold at market price. (i cannot find references to news articles now to back this.) the basic issue is this. there are two types of people who are displaced by these acquisitions: 1) landowning villagers and, 2) landless villagers. when the govt intervens, a lot monetary value is added to the land itself. Without this intervention,it may not have that much value. once govt intervenes by either declassifying or building road or layout, value of that land shoots up. but for many people land means more than its trade-in value, especially for those with small holdings. For such people, this type of compensation, where the landlosers are also part of the gains atleast for a few years, is probably more humane. but then again, just like not all bangaloreans are software engineers, not all villagers are landowning farmers. a village has all sorts of people. so what happens to those people, who dont own lands, when the entire village is acquired? there are many landowners who have happily sold their acre or two for a pretty paisa, but what happens to those who depended on that guy holding an acre for their meals? that is one aspect. lets say land has been acquired through a fair deal. what after that? for it to develop as a well planned coherent unit, somebody has to lay the roads and the pipes. a dwelling zone is more than the buildings and houses built on it right? somebody has to plan what goes where. without planning, we will only spread the mess around. there is a need for area wide planning. how can that happen without a public body intervening? forget roads and drains, how many private developers have developed water tight rain water harvesting systems in buildings which pride themselmes of the latest in italian bathroom fixtures? we all know the state of ground water thanks to laissez faire wrt to drilling borewells. how many public parks in that area? or do borewell water swimming pools count as one? how much land is left around whitefield for schools where tens of thousands of apartments have cropped up, most of which are owned by folks who prolly are have young families or are about to start one? i am not saying govt is a magical angel capable of doing all this. atleast with govt, there is potential and a hope, even if remote.
murali772's picture

how much is going into salaries?


The expenditure break-up has been shown sector-wise. Is there any way to find out what part of the whole goes into just salaries alone. My feeling is we have long ago crossed the sustainable level there.

Rather late to be commenting on this - but, better late than never. 

Muralidhar Rao

Muralidhar Rao
tsubba's picture


i dunno... i cant read numbers. can you make sense of this? i swear to god, i was thinking about it. one of the things that flashed in my mind was can some of the officials be retooled to work in education sector?
amaku's picture

Good Question!


You ask a very good question ...

'... not all villagers are landowning farmers. a village has all sorts of people. so what happens to those people, who dont own lands, when the entire village is acquired?'

Our farm had an entire village in the middle of it and pretty much every one of them worked on the farm. Once land was notified, the farm had to stop operations, all of them became instantly unemployed and would soon be homeless as well. We were able to find alternate employment for some of them, the rest had to fend for themselves.

I'm sure there are better ways to do this.


tsubba's picture

KHB PPP For Sites & Houses

HOUSING BOARD TO LAUNCH JOINT VENTURES WITH PVT. BUILDERS Star of Mysore, August 23, 2008. The Karnataka Housing Board (KHB) will soon launch housing projects under joint venture. This was disclosed by the Board Chairman and former Minister G.T. Devegowda at an interaction with mediapersons at Pathrakarthara Bhavan here this morning. He said that the Board had signed MoUs with nine private builders in the State for building houses, apartments and forming sites, incorporating appropriate features as per guidelines and policies. Of the nine projects, two will be launched in Mysore. M/s. Subramanya Constructions and Development Co. Ltd., Bangalore, will take up construction of houses, apartments and sites on 187 acres of land in Kergalli and with M/s. Central Resorts and Plantation (P) Ltd., Mysore will take up similar project on 150 acres of land in Kesare. Devegowda also said that the Board was planning to acquire 1,000 hectares of land around Mysore city and district. Once the land is acquired, the Board would provide basic infrastructure like water, drainage, electricity etc. Land will be purchased from the farmers on a 40:60 ratio, which means that 40 per cent of the developed land would be allotted to the land losers and the remaining 60 per cent of land would be utilised for the Board's projects, he added. Devegowda claimed that the offer had attracted farmers who are coming forward to allow acquisition of their lands. Waiting list Currently there are 3,08,000 applicants in the State in the waiting list of Board for sites and houses, out of which 77,000 are for houses and 2,31,000 are for sites, he said. He assured that 50 per cent of the waiting list would be cleared within one year. Devegowda disclosed that out of the 100 housing projects sanctioned by the Government, 67 had already been executed at a cost of Rs. 671.80 crore. A total of 4,890 houses and 17,357 sites had been developed under these projects. About 15 projects at a cost of Rs. 200 crore were nearing completion. A total of 852 houses and 5,502 sites are being developed under these projects, he said. MDJA President K. Shivakumar, Vice-President T.V. Rajeshwar, General Secretary Prabhurajan and City BJP President B.P. Manjunath were present at the interaction.
shobha's picture

Housing Board Land Acquire

I came to know about a case in Hassan district where the land was notified under 4A. Now the engineer association is planning to acquire the land at low cost. Few people are under loss. Is there any rule to stop Engineer association from acquiring that land. comment guidelines

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