Telangana Presents Trimmed Rs 1.46 Lakh Crore Budget For FY20
Telangana Chief Minister K Chandrasekhar Rao on Monday presented a trimmed Rs 146,492.30 crore budget for fiscal 2019-20, saying the state government had to revise the budgetary estimates due to economic slowdown and decline in revenues.
Presenting the budget in the assembly, the chief minister said in addition to the decline in state revenues, the Centre had also reduced allocations causing severe loss to the state.
Of the proposed budgetary expenditure, revenue expenditure has been put at Rs 1,11,055.84 crore and capital expenditure Rs.17,274.67 crore. The budget estimates pegged the revenue surplus at Rs 2,044.08 crore and fiscal deficit at Rs 24,081.74 crore.
In February, Rs 1,82,017 crore was shown as expenditure in the vote on account budget. The chief minister had presented the vote on account showing a revenue expenditure of Rs 1,31,629 crore and a capital expenditure of Rs 32,815 crore.
However, the government has decided to formulate the budget based on change in scenario due to economic slowdown and ground realities, Rao, who presented the budget in the Assembly, said.
"Economic slowdown is continuing in the country for the past 18 months. There is a steep fall in the Gross Domestic Product. All major sectors are experiencing downward trend. Revenues have fallen. The country’s economic situation has a bearing on the state too. The government has decided to formulate the budget based on the change in the scenario and the ground realities,” Rao said.
However, if the situation improves in future, there was always scope for making suitable changes in the estimates later, he said. In his speech, Rao "regretted" that he was presenting the budget when both the Centre and state were going through a severe financial crisis.
"We have to tread carefully and cautiously during such a testing time. We cannot go beyond certain limits. Against this backdrop of severe financial crunch, our Finance Department did a lot of brainstorming, discussed the matter with several experts and with a practical approach prepared 2019-20 budget proposals," he said.
There was a lot of difference between the estimates presented in the vote on account budgets of the Centre and the state, and the proposals made today, he said. Based on the provisional figures published by the Controller General of Accounts, it was estimated that there would be 22.69 growth in the tax revenue of the Centre during 2019-20, but in the first quarter, only 1.36 percent growth was realised, he said.
In Telangana too, a 15 percent growth rate was anticipated but only 5.46 percent could be realised, he said. In the last five financial years, in commercial taxes, the state recorded an average of 13.6 percent growth rate while it was 6.61 percent in the first four months of this financial year, he added.
The growth slowed down in other sectors, including stamps and registration and motor vehicle taxes, he said. There was a steep decline in the non-tax revenue too, he said. "In addition to the decline in the state own revenue, the Centre also had made a reduction in the funds that are to be transferred to the state. For 2019-20 financial year, the Centre has cut 4.19 percent in the states share in Central taxes (Devolution). The Centre also reduced allocations in several other items causing severe loss to the state," he added.
According to him, the situation of several other states is much worse than Telanganas, he said. Because of the "leverage" the state has due to its economic growth and fiscal discipline, it could raise funds from other financial institutions, he said.
Within the limits of Fiscal Responsibility and Budget Management and following the Centres guidelines, the state was raising funds from financial institutions, he said. The state government has decided to use extra-budgetary funds for the construction of major irrigation projects.
He said construction works on Kaleshwaram, Palamur-Ranga Reddy, Sitarama, and other major projects would continue without any interruptions. The budget proposed Rs 12,000 crore for the Rythu Bandhu farmers investment support scheme, Rs 1,137 crore towards premium for Rythu Beema insurance scheme for farmers and Rs 6,000 crore for crop loan waiver in the Budget.
The budget proposed Rs 8,000 crore for power subsidies. The amount proposed for Aasara social security pensions was Rs 9,402 crore. It also proposed Rs 2,714 crores for Gram Panchayats and Rs 1,764 crore for municipalities in the budget.
The state government wants to give "total clarity" on the funds given by Centre under Centrally Sponsored Schemes.
"In the last five years, funds of Rs 2,72,926 crore have been collected by the Centre through various taxes from Telangana state. Like all the states in the country, we have also received funds to the extent of Rs 31,802 crore from the Centre for the implementation of Central schemes in the state," the chief minister said.
According to the 'Overall Budgetary Position 2019-20' as provided in the 'Telangana Budget in Brief 2019-20', revenue receipts was put at Rs 1,13,099.92 crore, public debt Rs 32,900 crore, loan recoveries Rs 44.86 crore, public account (Net) Rs 500 crore and total receipts Rs 1,46,544.78 crore.
The public debt repayment was put at Rs 9,265.77 crore, loans and advances Rs 8,896.02 crore, and net surplus Rs 52.48 crore.