New Delhi: India is expected to give commodities and energy a boost in its updated budget on Monday, as lifeline monsoon rains are forecast to be below normal, threatening farm output and economic growth.

The government may seek to keep prices of food items such as sugar, grains and edible oils down, by either keeping import duties low or limiting exports.

Following are some of the expectations on the budget for the 2009-10 fiscal year that began on 1 April, based on representations by industry and trade bodies:,

FARM POLICY

• Food subsidy could be raised from around Rs50,000 crore ($10.4 billion) in 2008-09.

• Farmers may be offered relief on interest on loans to boost rural demand for items ranging from consumer goods to gold.

ENERGY

• May give tax holiday for natural gas production, as is the case with crude oil, to attract investment and help ongoing projects.

• Natural gas, which attracts different taxes in various states, may get a uniform levy of 4% across the country.

• May impose 5% import tax on crude oil and raise taxes on fuel. Roadmap for fuel price deregulation likely.

• Gas pipelines may get infrastructure status to allow them to take advantage of a 10-year tax holiday, boosting investment.

SUGAR

• Might extend duty-free imports of raw sugar beyond July to augment supplies as domestic production is low.

• Sugar producers expect lower excise duty on molasses to boost ethanol production.

GRAINS

• Tight control on exports may continue as the government would like to wait and see how the monsoon rains progress. If rainfall increases, some exports of wheat may be allowed as stocks are high.

EDIBLE OILS

• Import duty change, if any, would seek to balance huge domestic stocks and inflationary fear due to weak monsoon. A small hike on the current zero duty on imports of crude oils and 7.5% on refined oils may be imposed.

BASE METALS

• May announce safeguard duty on primary aluminium to help protect domestic producers such as state-run National Aluminium Co from cheap imports. The government had recently imposed a similar duty on rolled products.

• May lower import duty from 5% on unfinished metals such as copper cathodes, zinc ingots and aluminium ingots to help consuming industries.

STEEL AND IRON ORE

• Unlikely to raise steel import duty as prices are poised to rise and the government would want to keep costs down for its infrastructure push.

• Iron ore exports could be curtailed to preserve domestic resources for local steel mills and keep prices down.