Maharashtra budget: State hits new low on fiscal discipline

In two years, the Devendra Fadnavis government has raised Rs 69,167 crore in supplementary grants.

| Mumbai | Published: March 7, 2017 4:39:49 am

A white paper released in 2015 by the Devendra Fadnavis government on the health of Maharashtra’s economy had accused the previous Congress-NCP regime of denting the credibility of the state budget by repeatedly presenting supplementary demands. But since then the BJP-led government too has raised supplementary demands worth a record Rs 69.167 crore, stoking concerns over fiscal discipline and projections in the annual budget. With less than a month to go for the end of the current fiscal, Finance Minister Sudhir Mungantiwar Monday raised additional supplementary grants of Rs 11,104 crore for 2016-17. During the ongoing fiscal, the government has now raised
Rs 33,593 crore in supplementary demands. The government had earlier raised demands worth Rs 13,000 crore during the monsoon session. Another Rs 9,489-crore demands were raised during the winter session.

In 2015-16, the BJP government had similarly raised Rs 35,574 crore in supplementary grants. While the government had last year blamed contingencies emanating from the drought crisis for the fiscal indiscipline, the state has witnessed a good monsoon spell this time around.

Over 50 per cent (Rs 5,609 crore of the Rs 11,104 crore) of the demands raised Monday pertained to revenue expenditure. With the state increasingly resorting to institutional financing for major capital projects due to a cash crunch, a major component of Monday’s exercise was to provide for payments of loans and interest.

A provision of Rs 4,959 crore was made for expenditure proposed for raising medium- and short-term loans for the Maharashtra State Electricity Distribution Company Limited (MSEDCL). An additional Rs 992 crore was raised for servicing the same loan. Further, an additional Rs 150 crore was provided for interest payments on market borrowings.

Earlier this year, the government obtained a soft loan from NABARD to finance the 26 medium and major irrigation projects shortlisted under the Pradhan Mantri Krishi Sinchai Yojana. On Monday, it provided Rs 18 crore for interest payments towards this loan.

Also figuring prominently in the list of supplementaries were subsidies and grants-in-aid. The state has projected an additional expenditure of Rs 2,804 crore towards reimbursements for concessions in power tariffs announced for farm pumps and power looms, among other category of power consumers.

An additional Rs 1,003 crore was provided to make up for concessions extended in passenger fares in state transport buses. To meet the target of building 50,000 houses for the Scheduled Castes and neo-Buddhists under the Ramai Awaas Yojana, the state has provided additional subsidy of Rs 509.74 crore.

Amid the continuing spate of farmer suicides, the government made additional provisions of Rs 14 crore towards financial assistance for families of the victims. The government has also announced plans to extend interest subsidies to district cooperative bank and primary agriculture credit societies for improvement in the flow of crop loans. The state will provide Rs 116 crore in loans to improve the capital adequacy ratio (CRAR) of some unlicenced district cooperative banks.

On the capital side, the government has provided Rs 86 crore towards maintenance of repairs of Bandra’s government colony, Rs 4 crore towards construction of fishermen jetties and harbours, and Rs 9 crore for construction of various transport offices.

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