Recession hits Telangana : Govt trims budget outlay by 20% to Rs 1.46 lakh crore
The impact of economic recession in the country is palpable in Telangana.
Hyderabad: The impact of economic recession in the country is palpable in Telangana. The State government has trimmed the budget outlay for 2019-20 financial year to Rs 1.46 lakh crore from the Rs 1.82 lakh crore projected in the Vote-on-Account presented in the Assembly in March this year.
Although the government has reduced the outlay by almost Rs 30,000 crore as against Rs 1.74 lakh crore proposed in the corresponding year 2018-19.
Though substantial allocations were made for all welfare schemes and farmer-centric programmes like Rythu Bandhu, Rythu Bheema, etc, there will be no change in the welfare schemes that are being implemented.
But when it comes to allocation of funds for capital expenditure like irrigation and other infrastructure development programmes, the government has cut down the allocations.
For irrigation, only Rs 8,474 crore has been allocated as against over Rs 25,000 crore in every financial year in the previous four years.
Presenting the budget 2019-20 proposals in the Assembly on Monday, Chief Minister K Chandrashekhar Rao attributed the reasons to the slowdown in the national economy and drastic reduce in revenue collections which forced the government to cut the allocations for every wing except welfare and agriculture.
Stating that he was sorry to present a poor budget, the Chief Minister said, "Due to economic slowdown, during April and May this year, Rs 175 crore and during June and July Rs 700 crore was given as GST compensation.
The compensation taken during June and July was 4 times more than the compensation given in April, May and this alone reflects the steep decline in the financial situation."
He said the government had anticipated 15 per cent growth rate but only 5.46 per cent could be realised in state tax collections in the first four months of this financial year.
In the last five financial years, in commercial taxes, the State recorded an average of 13.6 per cent growth rate while it is 6.61 per cent in the first four months of this financial year.
In excise, only 2.59 per cent growth was registered and in stamps and registrations, it was only 17.5 per cent as against 19.8 per cent last year. There is also a steep fall in the vehicle taxes which declined to minus 2.06 per cent which was 10 per cent growth in the last 5 financial years.
KCR said there is also a steep decline in the non-tax revenue. Till last year, the growth rate was 14.9 per cent on an average and during the first four months of this financial year it fell down to minus 14.16 per cent.
In all, the non-tax revenue declined by 29 per cent. This is purely due to the economic slowdown. KCR said Telangana was slightly in a better position because of the leverage the State has due to its economic growth and fiscal discipline, it could raise funds from other financial institutions.
He also made it clear that based on the revenue resources, the government will review its priorities, make amendments from time to time. The government is planning to review the entire budget proposals in December.