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Economics of Haryana Budget 2015-16
To understand the provisions in the budget 2015-16 announced by the finance minister (FM) Capt Abhimanyu in his 28 pages speech developed in 39 points on March 17 for the economy of Haryana, we need to analyze the allocations in the budget size of Rs 69140.29 crore consisting of Rs 25743 crore plan expenditure, pattern of revenue deficit Rs 9557.52 crore (1.83%), fiscal deficit Rs16423.58 crore (3.14%) and the net borrowing limit of the state which has been capped at 3.25 percent of GSDP from 2015-16 onwards by the 14th Finance Commission with enhanced devolution of central tax resources to the states to 42 per cent from 32 per cent.
As admitted by the FM, the structural composition of the sate economy has followed the earlier trend and comes out to be Rs 30504 crore (27.7 %) from primary sector, Rs 57, 936 crore (26.9 %) from secondary sector and Rs 1,26,706 crore (58.9%) from tertiary sector during 2014-15.

It is pertinent to mention that Haryana's growth story is steady for long but it remain to be researched why Haryana could not achieve first position in per capita income (PCY), no matter Goa is a small state. In my opinion, if we adjust the Gross State Domestic Product (GSDP) of Rs 2,15,146 crore in 2014-15 with the contribution of the State people in military services, we are certainly number one in PCY also. In terms of PCY of Rs 1,47,076 in 2014-15 as compared to Rs 1,33,427 in 2013-14 with the growth of 10.2 per cent, Haryana is number 2 after Goa in the list of 29 States and 7 UTs.

Haryana can achieve first position by ensuring every foreigner visiting India to come to Haryana for spiritual tourism at Kurukshetra- a policy implication from the tourism based Goa economy. To reduce under employment which is one of the concerns for the State, there is a strong case for us to use vacations for vocations as Americans do to supplement their income. The allocation of Rs 20 crore for State museum at Kurukshetra is a step in right direction.

The removal of the value added tax (VAT) on bio fertilizers will certainly be improving soil health and environment.

The reduction of 5 per cent in rate of VAT on LED lights, pipe - fittings and prefabricated steel structures as development strategy is all right and deserve appreciation.

The allocation of Rs 2636.65 crore for agriculture and allied sector, an increase of 10.10 per cent was necessary but not sufficient to prove the government farmer friendly in the true sense. To conserve and upgrade of indigenous breeds of cows, the launching of 'Gauvansh Sanrakshan and Gausamvardhan' programme will certainly go a long way in milk production of cows which is considered healthy for the all including children.

'Haryana Fresh' will certainly be going to prove a brand in every household in urban areas of the state and prove farmer friendly marketing but may be little costly to 'apni mandi' culture which has developed over the years in the state. 'Har Khet Ko Pani' appears to be too ambitious which can be achieved by only 'rain harvesting' as mass movement with motivation. It is the need of the day to solve the problem of droughts on the one hand and water logging on the other- the most practical solution of the water crisis is the state caused by falling water table.

To ensure 24 hour supply of electricity to the people of Haryana, the provision of Rs 6546.91 crore was necessary but not sufficient. To make it sufficient, we needed to promote solar energy as a way of life. The economics of power sector reveals that the demand is always higher than the supply in the state particularly in summer. This calls for linking user charges with inflation rate based on consumer price index (CPI) - the need of the day for efficiency, sufficiency and equity in the state.

The enhanced allocation of Rs 27 291.27 crore (16.93 % higher over RE 2014-15) for the social sector consisting of education, health, medical education, women and child development, social justice and empowerment of SCs & BCs deserved to be called investment in human resource development (HRD) and calls for effective utilization with manpower planning which is sadly missing in my beloved country with ministry of HRD. There is no state government including Haryana having the ministry of HRD which is the need of the day to fetch fortunes of the so called opportunity of 'demographic dividend' lest it becomes demographic disaster.

To empower Panchayati Raj Institutions (PRIs) and Urban Local Bodies (ULBs), the allocation of Rs 548.70 crore in tune with 4th State Finance commission is not sufficient. This calls for proper pricing policy for birth certificate, marriage certificate and death certificate. I believe this alternative financing of PRIs & ULBs can go a long way not only for themselves but making it possible to share the resources with state and central government.

We needed to do debt management in the light of Haryana FRBM Act of July 2005 for attaining fiscal sustainability and stability. We required concrete efforts for better tax compliance, reductions in tax collection costs, focusing on recovering revenue arrears, pruning unproductive expenditure and above all good governance as SMART (Simple, Moral, Accountable, Responsive and Transparent) administration without any ifs and buts in the two white papers.

To do monitoring and evaluation of the state financing in a continuous manner, there is a strong case for State Institute of Public Finance and Policy which can be in the name of late Professor (Dr.) Prem Chand Jain who had authored 'Agricultural Taxation in Haryana' and three volumes of 'Economics of Public Finance' and a well known RSS economist of the State.

It is pertinent to mention that the funds can be obtained from the government of India for this purpose. There is also a strong case for the state NITI Aayog on the pattern of national NITI Aayog by using economists of the state for which there is no dearth.

(The author is Professor of Economics & Former Dean, Faculty of Social Sciences, Kurukshetra University, Haryana).

Editorial NOTE: This article is categorized under Opinion Section. The views expressed in this article are solely those of the author and do not necessarily represent the views of merinews.com. In case you have a opposing view, please click here to share the same in the comments section.
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