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Kerala Budget 2020 highlights: Thomas Isaac’s budget rooted in welfare measures

Kerala Budget 2020 Highlights: Finance Minister Thomas Isaac presented the state budget in the Legislative Assembly for the year 2020-21.

Written by Vishnu Varma | Kochi | Updated: February 8, 2020 12:11:09 pm
Kerala Budget 2020 presented by finance minister thomas isaac Kerala Budget 2020: Finance Minister Thomas Isaac presents the Kerala budget in the state legislative Assembly on Friday.

Kerala Budget 2020: Kerala Finance Minister Thomas Isaac Friday presented the state’s budget for the year 2020-21 in the Legislative Assembly. He began his speech with a reference to the ongoing protests against the Citizenship (Amendment) Act. and the resolution passed the House against it. He targeted the Centre for “strangulating” the state by denying it central funds.

In his budget speech, which last nearly two and a half hours, Isaac announced a slew of welfare measures. The state has hiked welfare pensions by Rs 100. It has promised to provide meals at Rs 25 at 1,000 Kudumbashree restaurants across the state. It also said it would build one lakh homes under the LIFE mission.

The Budget comes a day after the state government tabled its Economic Survey 2018-19 in the House, which pegged the state’s GDP at 7.5 per cent, a marginal increase from the previous year’s 7.3 per cent. There was, however, a decline in the agriculture sector, which fell from 1.7 per cent in 2017-18 to (-) 0.5 per cent in 2018-19.

The highest growth rate was recorded in the secondary or industrial sector, where the main push came from manufacturing. According to the Survey, state Public Sector Undertakings (PSUs) saw a total turnover of Rs 3,442.74 crore in 2018-19, a 17.9 per cent increase from 2017-18.

“In 2017-18, the contribution from the secondary sector was 27.7 per cent at constant prices and 25 per cent at current prices. Among the sectors, the highest growth was in the secondary sector with 8.8 per cent growth at constant (2011-12) prices followed by tertiary sector (8.4 per cent),” it stated.

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Finance Minister Thomas Isaac presented the Kerala budget in the state Legislative Assembly Friday. Read highlights in Malayalam

Highlights

    13:31 (IST)07 Feb 2020
    Here is the front page of the Kerala budget document

    Here is the front page of the Kerala budget document. 

    12:57 (IST)07 Feb 2020
    Kerala budget 2020 highlighting: Some announcements we missed

    Here are some announcements from the Kerala budget we missed:

    * A mega food park will come up in a 100-acre plot at a cost of Rs 150 crores

    * As part of carbon-neutral Wayanad initiative, 70 lakh trees, including bamboo shoots, will be planted across 6500 hectares.

    * 2.5 lakh families to get new drinking water connections.

    * The government plans to provide a share of the Provident Fund incentive given to employees, especially women, hired as part of new enterprises. Rs 100 crore allocated for the same.

    * Electricity generation will be raised to 500MW.

    * West-coast canal, from Bekkal to Kovalam, will be commissioned.

    * Production of essential medicines required after organ transplant will begin soon.

    * Cleaning of 5000-kms of canals will be completed in next FY

    * Construction of 12000 new public toilets.

    * Allocations for minority welfare is Rs 42 crores, for OBC welfare is Rs 101 crores, forward communities welfare is Rs 36 crores, differently-abled persons’ welfare is Rs 217 crores and share for local bodies is Rs 290 crores.

    * Rs 3 crores allocated to encourage women film directors and Rs 3 crores for encouraging amateur theater groups.

    11:47 (IST)07 Feb 2020
    Kerala budget 2020: FM concludes his two-and-a-half hour speech 

    Okay, that was a really long budget speech, even by Thomas Isaac’s standards. He says the budget is in the direction towards accelerating growth and industrial standards while upholding the state’s socialist and welfarist policies. He also makes an important mention, in the backdrop of the CAA protests, to protecting the state’s secular and democratic ideals by quoting a couple of verses from Rabindranath Tagore’s Nobel-winning Gitanjali. 

    11:39 (IST)07 Feb 2020
    GST tax collection below expectations, says FM during Kerala budget speech

    Kerala Finance Minister Thomas Isaac admits that the tax collection under GST has been below expectations of the government. This has been one of the major reasons for the state’s slow revenue growth. The state has also not received the pending GST compensation from the Centre.

    11:33 (IST)07 Feb 2020
    Govt announces austerity measures in Kerala budget

    The FM says the government will not purchase any new vehicles. Instead, it will hire vehicles on a monthly basis. This is certainly a good announcement, but not sure how practical it is. We’ve seen similar announcements in past budgets, but never really implemented on the ground.

    11:21 (IST)07 Feb 2020
    Kerala budget 2020, focus on women

    Here are some women-friendly budget announcements by the FM: Rs 6 crore to be allocated for schemes for women fish workers; honorarium for Asha workers to be hiked by Rs 500; Rs 1,509 crore for women-friendly projects; She-lodges to come up in every town. 

    11:16 (IST)07 Feb 2020
    For those keeping a count on Isaac’s literary references in Kerala budget speech

    Thomas Isaac’s budget speeches are known for oft-repeated references to the Malayalam writers and poets. If anybody’s keeping a count, they can read our Malayalam piece on it. From K Satchidanandan to Benyamin, Anwar Ali to OP Suresh, Drupad Goutham to Vinod Vaishakhi, they are all here.

    11:13 (IST)07 Feb 2020
    Kerala Budget 2020: Key highlights from Finance Minister Thomas Isaac's speech

    Kerala Finance Minister Thomas Isaac’s budget speech in the state Assembly has crossed two hours. In case you’re just joining us, here are some highlights on what he has announced:

    * All welfare pensions to be hiked by Rs 100

    * Rs 1,000 crore allocated for building rural roads

    * Rs 90 crore allocated for the welfare of expatriates 

    * Rs 1,000 crore for the state’s coastal community

    * Projects under KIIFB to be completed within stipulated time frame

    * District cooperative banks to be merged to form Kerala Bank 

    * 1,000 hotels to be set up by Kudumbashree to provide meals at Rs 25

    * CFL, filament bulbs to be banned from Nov 

    * Rs 10 crore allocated for 'Nirbhaya homes'

    * Rs 323 crore for tourism sector

    * Rs 3 crores for Vazhakkulam pineapple farming

    * Rice and rubber parks to begin in next fiscal year

    * Rs 5 crores for cashew farming

    * Rs 20 crores for cashew board

    * Rs 28 crores for coir sector

    * Rs 20 crores for hunger-free Kerala

    11:07 (IST)07 Feb 2020
    Champions Boat League a big success, says FM in Kerala budget speech

    One of his pet projects, FM Thomas Isaac says the Champions Boat League (CBL), an IPL-model snake-boat race competition, has proved to be a big success. The inaugural edition was held last year and ace former cricketer Sachin Tendulkar was the chief guest. It seems to have bolstered the revenues and earnings of the local snake boat clubs in Alappuzha, Kollam, Kottayam and Ernakulam districts and brought international audiences to it as well. The FM allocates Rs 20 crore for the CBL. To know all about the CBL, read this piece.

    11:05 (IST)07 Feb 2020
    Kerala budget: Rs 493 crore allocated for higher education sector

    Expansion of laboratories in colleges, 1,000 new appointments in public colleges, history museum at the CMS college in Kottayam and 60 new courses are among the key announcements in the allocation of Rs 493 crore for the higher education sector in the state. 

    10:48 (IST)07 Feb 2020
    In budget, FM says all streetlights across Kerala to be changed to LED

    The Finance Minister announces that all streetlights across Kerala will be changed to LED. That’s a big and ambitious announcement, I would say. Also, this is in line with the government’s decision to ban filament and CFL bulbs from November 2020. It’s seen as an important step towards energy conservation.

    10:46 (IST)07 Feb 2020
    Kerala budget 2020: Here are the FM's agro-promises

    Thomas Isaac says 75 coconut saplings will be distributed in every ward and more value-added products will be derived from coconut. Rs 3 crore will be allocated for pineapple farming in Vazhakkulam. The FM talks of creating villages that are free of barren areas. We have 26 villages currently that are completely non-barren. In the next financial year, we will have integrated rice and rubber parks in the state.

    10:44 (IST)07 Feb 2020
    FM allocates Rs 2,400 crore for Kuttanad in Kerala budget

    Rs 2,400 crore has been allocated for the Kuttanad region in Alappuzha. As many might know, it was one of the worst-affected areas in the 2018 floods. It’s also one of the few places in the world where farming is done below sea-level. The package is likely to address health, education and farming concerns of the people. Minutes before this, FM Thomas Isaac had announced that Alappuzha, his hometown, would be developed as a heritage town. 

    10:31 (IST)07 Feb 2020
    Kerala budget 2020: Rs 323 crore for the tourism sector

    One of the key sectors providing revenues for the state government with more potential in the future is the tourism industry. The FM has allocated Rs 323 crore for the sector. He underlines that the Muziris heritage project, in its entirety, will take off in 2021. Also, Alappuzha, the hometown of the finance minister, will be developed as a heritage town.

    To understand what the Muziris heritage project is all about, click here to read my travel piece.

    10:21 (IST)07 Feb 2020
    Kerala budget, housing allocation: Rs 10 crore allocated for 'Nirbhaya homes'

    In the third phase of LIFE, we will provide 40,000 homes to fishermen families, says FM Thomas Isaac. Work on 10 apartment complexes has begun. We will have she-lodges in every district for travelling single women. Rs 10 crore has been allocated for ‘Nirbhaya homes’, though it’s not clear whom these homes are aimed at. Again, we’ll have to look at the fine-print to know more.

    Kerala Chief Minister Pinarayi Vijayan with state Finance Minister Thomas Isaac in the Assembly on Friday. (Screengrab)
    10:17 (IST)07 Feb 2020
    Kerala budget 2020: 1,000 hotels by Kudumbashree soon to provide meals at Rs 25

    In the last budget, the government envisaged a scheme to make Kerala hunger-free. Under the leadership of Kudumbashree, the FM says the government will start from April 2020 onwards 1,000 restaurants which will provide meals at Rs 25 each. The government will also strike to declare the areas of Cherthala and Ambalapuzha hunger-free, the FM adds. With the help of sponsors, the government will try to provide meals at Re 1 at select hotels to those who cannot afford to buy food.

    10:04 (IST)07 Feb 2020
    Kerala budget 2020: CFL, filament bulbs to be banned from November 2020

    Kerala Finance Minister Thomas Isaac announces that the manufacturing of CFL and filament bulbs will be stopped and the use of such bulbs will be banned from November this year. He said the state needs to move on to LED bulbs.

    10:01 (IST)07 Feb 2020
    Kerala Bank is a reality today, says Thomas Isaac in budget speech

    FM Thomas Isaac has flagged the formation of Kerala Bank by merging all the district cooperative banks and making the banking system easier and transparent for the people of the state.

    09:57 (IST)07 Feb 2020
    If you’d like to follow updates on the Kerala Budget in Malayalam

    As always, we have our sister Malayalam site giving minute-by-minute updates on Thomas Isaac’s budget presentation in the local language. You can follow them here.

    09:47 (IST)07 Feb 2020
    During Kerala budget presentation, FM mentions Kochi Metro project, Water Metro project

    While presenting the Kerala budget, the FM cites developments in the Kochi Metro project. An extension from the JLN stadium to the IT hub of Kakkanad is on the anvil. Also, the Water Metro project, linking islands to the city, will take off at the end of 2020.

    With 621-km human chain, Kerala pledges to protect Constitution Kerala Budget 2020: Chief Minister Pinarayi Vijayan. (File Photo)

    Kerala budget 2020-21 highlights:

    For the year 2019-20, Kerala Finance Minister Thomas Isaac had presented an expansive budget, covering a wide range of sectors with special emphasis on rebuilding efforts post the devastating floods last year and aiming to open new avenues to generate non-tax revenues.

    The cost of the budget was pegged at Rs 1.42 lakh crore, with an aim to reduce the fiscal deficit by 1 per cent and revenue deficit by 3.3 per cent.

    In an exclusive interview with The Indian Express, he had said, “Kerala’s fiscal situation is bad. It’s because we have been adopting expansive stands on development but GST has belied our hopes. We are still 13-15% behind the projected revenue. Our whole mean fiscal policy was premised upon a 20% growth on GST. Kerala being a consumer state, that was naturally our expectation. More than that, during the previous governments from 2006-14, VAT was growing at 18-19% pa. Now it’s very slow primarily because of internal leakages.”

    The Economic Survey 2019-20 has presented a brighter picture for the state, with GDP at 7.5 per cent. The agriculture sector, however, saw negative growth. It fell from from 1.7 per cent in 2017-18 to (-) 0.5 per cent in 2018-19.

    The bright spot was the secondary or industrial sector. "In 2017-18, the contribution from the secondary sector was 27.7 per cent at constant prices and 25 per cent at current prices. Among the sectors, the highest growth was in the secondary sector with 8.8 per cent growth at constant (2011-12) prices followed by tertiary sector (8.4 per cent)," the Survey stated.

    The main push came from the manufacturing sector, where state Public Sector Undertakings (PSUs) saw a total turnover of Rs 3,442.74 crore in 2018-19, a 17.9 per cent increase from 2017-18.

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