HIGHLIGHTS-India's 2012/13 budget presented to parliament

March 16 Fri Mar 16, 2012 2:12am EDT

March 16 (Reuters) - Finance Minister Pranab Mukherjee presented India's federal budget to parliament on Friday for the coming financial year beginning in April.

FINANCE MINISTER ON GOVERNANCE

"We have to accelerate the pace of reforms."

GROWTH AND INFLATION EXPECTATIONS

* Expect headline inflation to moderate in next few months and remain stable thereafter

* Economy expected to grow at 7.6 percent in 2012/13, plus or minus 0.25 percent

* Economy expected to grow at 6.9 percent in 2011/12

* Signs of economy turning around in March quarter

POLICY REFORMS

* To allow qualified foreign investors in Indian corporate debt markets

* To allow external commercial borrowing to part finance rupee debt in power projects

* Allow external commercial borrowing of up to $1 bln to raise working capital for airlines industry for 1 year

INFRASTRUCTURE SPENDING

* To award contracts to build 8,800 km of roads in 2012/13

* Govt to provide 600 billion rupees in tax free bonds for financing infrastructure projects in 2012/13

DISINVESTMENT

* Disinvestment target in 2012-13 of 300 billion rupees

SUBSIDIES

* To keep 2012/13 subsidies under 2 percent of GDP

* To inject 159 billion rupees to capitalize state-run banks in 2012/13

CURRENT ACCOUNT

* Current account deficit seen at 3.6 percent of GDP in 2011/12

* Expect smaller current account deficit in 2012/13

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