The UPA government seems to be strictly adhering to the priorities charted out with its coalition partners. In the interim budget to be presented on February 16,finance minister Pranab Mukherjee will seek Parliament nod for a gross budgetary support (GBS) of Rs 2,85,000 crore including a mammoth 43 per cent increase in allocation for flagship programmes.
According to finance ministry officials,the fiscal stimulus to the economy during the last four months has seen the GBS for 2008-09 jump from the originally budgeted Rs 2,43,386 crore to Rs 2,74,000 crore in the revised estimate. The estimate includes Rs 20,000 crore additional expenditure announced in the first stimulus package and Rs 10,000 crore extra money to states.
A GBS of Rs 2,85,000 crore for the next fiscal effectively means that the increase is just Rs 11,000 crore or a meager 4 per cent over the revised estimate of Rs 2,74,000 crore for the current fiscal.
The officials said that the combined allocation towards Plan expenditure for flagship programmes including Bharat Nirman and the employment guarantee plan would be increased up by a substantial 43 per cent. This would see the allocation jump by Rs 33,000 crore to Rs 1,23,000 crore.
The allocation for ministries such as human resource development and health,which received a lions share in the previous years,will be maintained at 2008-09 level. In fact,these ministries did not quite benefit from the stimulus packages that included an additional spend of Rs 20,000 crore. States are,however,concerned about lower fund flow when the government presents its Budget for the next fiscal. They want more leeway in market borrowings because of a dip in their share of Central taxes and duties. The Centre,hit by a sharp powering down of the economy,is likely to aim at only a 10 per cent growth in tax collections next fiscal against the 17.6 per cent growth expected in 2008-09.
The states have told the Planning Commission the additional scope for borrowing under the stimulus package would enable them to just about meet the revenue loss due to the slowdown.