Presenting the interim budget, the last financial account of UPA-2 in the Lok Sabha today, Finance Minister P.Chidambaram announced amidst thumping of desks by ruling party members that the government has accepted the principle of One Rank One Pension for the defence forces.

Proposing transfer of 500 crore rupees to the defence pension account in the current financial year itself, he said the nation needs young fighting force and there is need to take care of those who served in the defence forces only for a limited number of years.

Therefore, he said the government has decided to walk the last mile and close the gap for all retirees in all ranks. The minister also announced 10 percent hike in defence allocation.

Mr. Chidambaram said, in keeping with the convention, he does not propose to make change to the tax laws but some interventions can not wait for the regular budget.

He said, the manufacturing sector needs an immediate boost and proposed reduction of excise duty from 12 percent to 10 percent for capital goods and consumer non-durables falling under chapter 84 and 85 of the schedule to the Central Excise Tariff Act.
This will be for a period till 31th of June when a regular budget will be taken up by the next government.