Reining in deficit to be a tall order 

TS Budget 2016-17

It is really baffling for even economists as to how the budget figures for 2016-17 have gone up by Rs 20,000 crore. Right from the Chief Minister to the ministers, everyone is claiming that they would improve the revenue without imposing tax burden on people. They also say that Telangana is a rich State and there is no dearth of funds. In the 2015-16 budget, the revenue was shown as Rs 94,132 crore. The present financial year would be ending in 45 days and so far the revenue is only Rs 54,000 crore. How can the government garner Rs 40,000 crore in 45 days?

The State Cabinet has stirred a hornet’s nest by announcing the budget details for the financial year 2016-17. Finance Minister Eatala Rajender announced that the budget for 2016-17 would be with an outlay of Rs 1.35 lakh crore which is Rs 20,000 crore more than the previous budget. Naturally, people tend to anticipate more allocations to various schemes next year.

Details to show fate of outlays

The TRS government introduced its first budget with an outlay of Rs 1 lakh and 638 crore soon after coming to power. The next year, a budget for Rs 1,15,689 crore was presented without presenting the revenue and expenditure details of the earlier budget in the Assembly. This time the State government has to produce the details of expenditure and revenue for both the years while presenting the budget for 2016-17.

Steep rise in non-tax projections

In the first budget, the income from revenue head was shown at Rs 21,720 crore as grants. However, in the present budget, the grants were shown as Rs 12,400. What prompted the government to drastically reduce the grants? The State government is also showing inflated numbers of the Central and the State taxes and non-tax revenue.

For instance, the non-tax revenue was shown in 2014-15 as Rs 13,242 crore and in 2015-16 it was shown as Rs 22,413 crore. How could there be so much increase in non-tax revenue?

Not only the revenue but investment was also shown in inflated numbers. It is really baffling for even economists as to how the budget figures had gone up by Rs 20,000 crore. Right from the Chief Minister to the ministers, everyone is claiming that they would improve the revenue without imposing tax burden on people.

They also say that Telangana is a rich State and there is no dearth of funds. In the 2015-16 budget, the revenue was shown as Rs 94,132 crore. The present financial year would be ending in 45 days and so far the revenue is only Rs 54,000 crore. How can the government garner Rs 40,000 crore in 45 days?

Under sub-plan, Rs 8,089 crore for Dalits, Rs 5,036 for Girijans were allotted in addition to the regular budget allocations. It is high time to review how far the expenditure on Girijans and dalits helped their growth. And it is not sure how far the allocations to irrigation, Dalits, Girijans, minorities, women, children and physically handicapped were actually spent.

Agriculture sector badly hit

Moreover, the agriculture production has come down drastically due to the adverse climate conditions. Out of 133 lakh acres of cultivable land, only 103 lakh acres were cultivated this year. Crops in the fifty per cent of the cultivated land withered away due to the deficit rainfall. The yield has considerably come down.

Out of the estimated production of 115 lakh tonnes of food grains the yield may be 65 lakh tonnes. Even in 2014-15 also the production of food grains was only 65 lakh tonnes out of the estimated production of 105 lakh tonnes.

12% growth rate?

It may be noted here that the industrial growth rate depends on agriculture growth rate. And the services sector and employment would flourish with industrial growth. Out of the 9,900 industries in the State, about 3,000 industries were closed due to shortage of raw material, power, water and transportation. Still the government surprisingly claims that it had achieved 12 per cent growth rate.

Nobody knows what the basis for such claims is. The government which claimed that Telangana was a rich State is now shy of reconciling to the truth of deficit budget. As per the government statistics, paddy was cultivated in only 19.21 lakh acres during both Kharif and Rabi seasons as against the 42 lakh acres in the State. As a result, Telangana is compelled to import food grains from other States. The cultivation of oil seeds, chilli, onion and turmeric has considerably come down.

Plan expenditure to be higher

In spite of these facts, the State government has been announcing that the State is on the path of development. Generally, non-plan expenditure would be 60 to 70 per cent. However, the Finance Minister announced recently that the plan expenditure would be more during this budget. He did not clarify how this was possible.

No single project completed

Not a single project has been completed in the last two years though the government claimed allocation of funds in the budget. The works on all projects were stopped in the name of re-designing. Even the projects which were completed 70 to 80 per cent were also not completed. Surprisingly, the government claims that it would supply water for irrigation by next June.

The government announced Rs 40,000 crore for Mission Bhagiratha, Rs 35,000 crore for Palamuru Lift Irrigation scheme, Rs 38,000 crore for Kaleswaram-Chevella lift irrigation scheme. Though the intention is good, where is the availability of funds in the budget?

Will the government allocate funds for schemes like three acres for dalits, double bedroom houses, KG to PG education and others? The farmers are yet to get Rs 8,000 crore under loan-waiver scheme. The government has not implemented its promise to establish research institutes for turmeric and sugar in Nizamabad district. Moreover, three Nizam Sugar factories were closed. The farmers are incurring losses in transportation when the officials tell them to send sugarcane to other factories.

Water, employment, literacy state poor

Water for irrigation and drinking, employment and education are important for the growth of any civil society. All the three are lacking in Telangana. The literacy rate in Telangana is 65 per cent only as against the national average of 74.4 per cent. The literacy rate in Mahbubnagar and Adilabad districts is less than 54 per cent. Drinking water business is making huge profits running into several crores of rupees. Dairy farmers are incurring losses.

It is estimated that already 13 lakh people have migrated looking for livelihood. The government is giving more priority to construction of temples and buildings rather than concentrating on production. Education right from KG to PG is completely privatized, though the TRS promised people that it would close down the corporate education institutions after coming to power.

It is pathetic that cotton and yarn mills are closed in Telangana State where surplus cotton is available. If the budget is allocated to reopen them, employment opportunities could be created. As many as 1.7 lakh unemployed persons got their names registered and soon they would be age-barred.

The debt burden on the State government is Rs 1 lakh crore and during 2015-16, Rs 7,545 crore was paid as interest for debt servicing. It would be Rs 9,000 crore this year which means ten per cent of the budget amount goes towards interest payments. The State government should keep in view the past experience of erstwhile governments which have miserably failed in developing the State and look forward to giving priority to production. (The author is Vice President, All India Kisan Sabha)