States’ internal fund raising dips

The Planning Commission attributes the low level of fund mobilisation by states to a low balance from current revenue, unsatisfactory performance of state level public enterprises and low additional resource mobilisation.

The deterioration in balance from current revenue has been four times that of what was envisaged during the Ninth Plan mainly due to low realisation of revenue receipts and high non-Plan revenue expenditure. While realisation of revenue receipts merely touched 53.3% of the Ninth Plan target, non-Plan revenue expenditure reached 40% of the projected target.

Poor performance by state level public enterprises, especially the state electricity boards and state road transport corporations, has eaten into the state’s own funds in the last three years. While the public enterprises were projected to contribute Rs 1,353 crore towards the Plan, the actual contribution has been (-)Rs 17,398 crore. The SEBs were projected to utilise Rs 1,024 crore during the entire Plan period. Their performance has been worse than anticipated with the sector utilising Rs 16,810 crore of the state’s resources in just three years. The STRC’s were supposed to contibute Rs 326 crore, but their actual contribution has been (-)Rs 1,903 crore till now.

Additional resource mobilisation in the first three years has also been at a low level with only 11.78 per cent of the projected target being realised. Against a five-year target of Rs 1,14,451 crore from budgetary and non-budgetary measures, the actual realisation in three years has been Rs 13,487 crore. Moreover, the realisation of Plan grants awarded by the Tenth Finance Commission has also been low. As against the target of Rs 9,418 crore during the plan, the acutual realisation during the first three years has been Rs 4,601 crore. Central assistance of Rs 76,187 crore has been released to states in the first three years against a total plan projection of Rs 1,68,775 crore. According to the Commission, the low realisation is due to a lower utilisation of central assistance under externally aided programmes (EAP).

Panel blasts Govt for slow pace of APM dismantling New Delhi:
Planning Commission has pulled up the government for slow pace in dismantling of Administered Pricing Mechanism (APM) for petroleum sector even as it predicted a 10 per cent shortfall in domestic crude oil production. "As per the programme on dismantling of APM by 2002, subsidies for cooking gas (LPG) and kerosene were to be reduced in a phased manner and this has not been done. The policy of linking diesel prices with work prices has also not been implemented regularly as was envisaged. This has created uncertainty about policy in the area," the mid-term review of Ninth Five Year Plan said. The dismantling process of APM needs to be followed as envisaged so that prices are deregulated by April 1, 2002, it said.

It said that the present dispension of giving marketing rights of petroleum products to oil companies investing Rs 2,000 crore in domestic refining capacity or creating facilities to produce three million tonnes of crude oil has not been found attractive to potential investors. Calling for review of policy on marketing rights, it suggested inclusion of investments in marketing and distribution of petroleum products in the above criteria.

Domestic crude oil production is likely to fall short by 10 per cent of the targetted 180.82 million tonnes during the Ninth Plan Period, it said.