Slowdown deeper in TS as revenue growth halves
Slowdown in Telangana economy seems to be real and deep with the State registering mere 5.4 per cent rise in revenue receipts till November 2019, a drastic fall from 11 per cent upswing it recorded in the same period last financial year.
Hyderabad: Slowdown in Telangana economy seems to be real and deep with the State registering mere 5.4 per cent rise in revenue receipts till November 2019, a drastic fall from 11 per cent upswing it recorded in the same period last financial year.
According to monthly key economic indicators submitted by the Telangana government to CAG, Telangana's revenue receipts reached Rs 61,862.58 crore till November 2019, an increase of Rs 3,211 crore or 5.4 per cent from Rs 58,651 crore the State received in the same period last fiscal year.
But the revenue growth rate was double at 11 per cent, or Rs 5,918 crore, in April-November 2018 period from Rs 52,733 crore in the previous year i.e. April-November 2017. That means revenue growth rate fell more than 50 per cent in the first nine months of the current fiscal year compared to the same period last financial year.
The Goods & Services Tax (GST) was the biggest drag on Telangana's revenue growth story with GST collections contracting by four per cent to Rs 18,218 crore till November 2019 in the current financial year against Rs 18,964 crore in the same period a year ago. But the tax collections were robust last fiscal, and Telangana registered six per cent growth in sales tax revenues from Rs 17,931.24 crore in April-November 2017.
Interestingly, income from property registrations did not come to the rescue of the government despite real estate sector in Hyderabad going through a golden run. Data reveals that growth rate in income from Stamps and Registration Fees decelerated by over 50 per cent year-on-year.
The State registered 20 per cent rise in revenues in this segment to Rs 4,289 crore this fiscal till November from Rs 3,557 crore till November last financial year. The year-on-year growth was 45 per cent in the same period last fiscal from Rs 2,446 crore during April-November 2017 period.
Non-tax revenue was also not at an encouraging level. This segment contributed Rs 2,736 crore to the exchequer till November last year, down from Rs 2,993 crore a year ago period. The government set an ambitious annual target of Rs 15,875 crore from this revenue stream against the yearly target of Rs 8,973 crore last fiscal.
However, liquor churned out better revenues for the government this year too. Income from State excise duties stood at Rs 7,454 crore till November 2019, a growth of 12 per cent from Rs 6,643 crore a year ago. The growth rate from this segment was just six per cent till November last fiscal.
With fall in revenue, the government stepped up borrowings. The net borrowings and other liabilities reached Rs 20,123.76 crore till November 2019, which account for nearly 83.56 per cent of the total budgeted borrowing target of Rs 24,081.75 crore for the current fiscal.
In the same April-November period in 2018, the State used 74 per cent of budgeted borrowing target of Rs 29,077.07 crore. Further, the State government reported a revenue deficit of Rs 3,572.99 crore till November against the full-year target of Rs 2,044.08 revenue surplus. Fiscal deficit hit Rs 20,123.76 crore, or 83.56 per cent, of full year budgeted target of Rs 24,081.75 crore.
It is pertinent to mention here that Telangana has outsmarted the country in GDP growth rate in the past few years. Will this trend continue this financial year? That will be known only after the Telangana government presents its annual budget for 2020-21.