NEW DELHI: Petrol will cost Rs 1.26 less per litre, but CNG, which fuels public transport on Delhi’s roads, is set to get costlier by Rs 1.77 per kilogram. The Delhi budget presented by chief minister Sheila Dikshit on Monday also saw two-thirds of expenditure being earmarked for the social sector, no suprise with assembly elections due next year.

The budget for 2012-13 proposes to provide some relief from last week’s steep Rs 7.54 hike in petrol prices by slashing the 20% Value Added Tax (VAT) on the hiked component, but at the same time introduces 5% VAT on CNG, triggering speculation of a possible increase in auto and taxi fares.

The price changes will come into effect only after the budget is passed by the Delhi assembly on Monday. Once that happens, petrol will cost Rs 71.92 instead of Rs 73.18 per litre. Revenue foregone on this account will be about Rs 140 crore. CNG will go up from Rs 35.45 by Rs 1.77 paise per kilo.

Presenting a budget that envisages total spending of Rs 33,436 crore and a Plan outlay of Rs 15,000 crore for the current year, Dikshit said 65% of the outlay or Rs 9,796 crore is to go towards the ‘social service sector’. She described her budget as one that focuses on ‘roti, shiksha aur swastha’ (food, education and health). Moving away from weaving dreams of a ‘world class city’, a commonly used phase before the Commonwealth Games, this year’s budget speech focuses on the more modest target of building Delhi into a ‘good city’.

The budget laid out a wide spread of social sector schemes and sops for the poor. The high point of the speech was the launch of plans to make Delhi kerosene-free. The government will provide a one-time subsidy of Rs 2,000 to about 1.75 lakh poor households that currently use kerosene for cooking to obtain LPG connections and purchase a gas stove. An outlay of Rs 40 crore has been earmarked for this purpose.

To reach out to the poor, an ambitious scheme called ‘Dilli Annashree Yojna’ has been launched to provide a food subsidy of Rs 600 per month to two lakh vulnerable household that are not covered by either BPL cards or under the Annapurna and Antyodaya schemes. This scheme is expected to cost the government Rs 150 crore this year.

Poor people suffering from HIV/AIDS will also be given Rs 1,000 per month for anti-retroviral treatment under another scheme. For orphaned children, the amount under this scheme will be Rs 2,050 per month. The state has also introduced schemes for SC/ST and OBCs through the Dilli Swarojgar Yojana wherein loans of up to Rs 5 lakh will be provided to entrepreneurs willing to set up ventures in Delhi. Rs 50 crore has been set aside for the scheme. These apart, a major part of the budget came as old wine in a new bottle. Promises of regularization of unauthorized colonies, allotment of EWS housing for the poor, the ambitious Signature Bridge project, extension of the Barapullah elevated road till INA, making both Ring Road and Outer Ring Road signal free are some of the projects that have figured in budget speeches previously too.

“This budget for me is a people-friendly and situation-friendly budget. We will continue to look more intensely at the education, health and financial needs of the weaker sections. We would like to see Delhi developing into a good city to live in and a city that caters to the needs of all sections of the society,” Dikshit said while delivering the budget. The chief minister said the government would pay special attention to qualitative improvements of the vastly upgraded physical infrastructure and expansions of the roads, power, metro and water networks.

Dikshit justified the move to introduce VAT on CNG saying that both UP and Haryana have been levying the tax and the capital was only taking the step now. “Neighboring states of Uttar Pradesh and Haryana have been levying VAT at 12.5% and 5% respectively on CNG. But we are introducing the tax after over 10 years of CNG in Delhi,” Dikshit said, asserting that this will not put pressure on the ‘aam admi’ since CNG is used in public transport. However, when asked whether this would impact fares of autorickshaws and taxis in the future, the Delhi CM was evasive. “We will see how the introduction of VAT on CNG plays itself out. I cannot say anything right now,” she said. However, Dikshit admitted that the relief on petrol may not prove as a big relief for vehicle owners who also use CNG.

On the petrol hike, Dikshit said the price of petrol in Delhi is the lowest among all metro cities and lower than the price in neighbouring cities of Haryana and Uttar Pradesh. “But in view of the price hike in petrol, citizens of Delhi need to be provided some relief. We have given relief to the people when there was an increase in the price of diesel by exempting VAT on the increased component last year. Similarly, I propose to exempt the recently announced increase in the price of petrol from the levy of 20% of VAT,” Dikshit said while presenting the budget.