New Delhi: Finance Minister Pranab Mukherjee on Friday began presenting the Budget for the next fiscal, recalling the hard days of past two years, but with an assurance that the worst was over for the economy and the days ahead were promising though not without challenges.

"Today, as I stand before you, I can say with some confidence that we have weathered this crisis well," Mukherjee told the Lok Sabha, the lower house of parliament.

"That is not to say that the challenges today are any less than they were nine months ago, when the UPA was voted back to power under the leadership of Sonia Gandhi and Prime Minister Manmohan Singh," he added.

He said three challenges he had listed last year remained relevant today -- those of quickly reverting to a high growth path of 9 percent and cross over to double-digit expansion; making growth more inclusive and developing infrastructure in rural areas; and strengthening food security.

He said in 2009, when he presented the interim budget in February and the full budget in July, the Indian economy was facing grave uncertainty, the economy slowed down and business sentiment was low.

But this year, the budget has came against the backdrop of the Economic Survey for 2009-10, saying India's growth can go up to double digit levels in four years, with the country emerging as the fastest growing economy in the world.

The initial market reaction, as the finance minister began his budget speech was guarded, with the sensitive index (Sensex) of the Bombay Stock Exchange (BSE) ruling at 16,347.72 points, against the previous day's close at 16,254.2 points, with a gain of 93.52 points, or 0.58 percent.

Those in the packed house presided over by Speaker Meira Kumar, included Prime Minister Manmohan Singh, United Progressive Alliance (UPA) chairperson Sonia Gandhi and Leader of Opposition Sushma Swaraj.

Although the Budget speech also contained some policy pronouncements and other steps directed at reforms, it is basically an annual statement of accounts for the upcoming fiscal in terms of receipts and expenditure, along with direct and indirect tax proposals.

The Budget was presented after a quick meeting of the Union Cabinet inside Parliament presided over by the Prime Minister for a customary approval for the proposals.

Budget highlights:

India has weathered global economic crisis well; Indian economy in far better position than it was a year ago. In 2009 Indian economy faced grave uncertainity; delay in southwest monsoon had undermined agricultural production.

First challenge now is to quickly revert to 9 percent growth and then aim for double digit growth; need to make recovery more broadbased.

Second challenge is to make growth more inclusive; have to strengthen food security.

Third challenge is to overcome weakness in government's public delivery mechanism; a long way to go in this.

Impressive recovery in the past few months. Can witness faster recovery in the coming months, says Mukherjee.

Focus shifted to non-governmental actors and an enabling government. Government will concentrate on supporting and delivering services to the economically backward sections.

Fiscal year 2009-10 was challenging for Indian economy

Economy stablished in Q1 of 2009 itself

Manufacturing growth at 18.5 per cent in December was highest in two decade

Export in January encouraging

Figures for merchandise exports for January encouraging after turnaround in November and December last.

Double digit food inflation last year due to bad monsoon and drought-like conditions

Erratic monsoon and drought-like conditions forced supply side bottleneck that fuelled inflation

Government conscious of the situation of price rise and taking steps to tackle it

Need to review stimulus imparted to econony

Need to ensure that the demand-supply imbalance is managed

Stress on the need to make growth more broad-based

Need to review the public spending and mobilise resources

Status paper on public debt within six months

Finance Minister says Government hopes to implement direct tax code from April 2011.

Earnest endeavour to implement General Sales Tax in April 2011.

Government will raise Rs 25,000 crore from disinvestment of its stake in state-owned firms

Kirit Parekh report on fuel price deregulation will be taken up by Oil Minister Murli Deora in due course

Nutrient based fertiliser subsidy scheme to come into force from April 1, 2010

Market capitalisation of five PSUs listed since October increased by 3.5 times

FDI inflows steady during the year. Government has taken series of steps to simplify FDI regime

The 74-year-old Lok Sabha MP is presenting his fifth Budget while grappling with the problems of rising prices and an economy that is still feeling the effect of the global slowdown of the last two years.

The Economic Survey 2009-10 presented on Thursday favoured the gradual rollback of stimulus measures that were introduced following the global economic meltdown in late 2008.

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