Once the pull and tug over power-sharing between the BJP and Shiv Sena subsides, the new government in Maharashtra would do well to take another look at the white paper presented to the state legislature in April 2015 on the health of the state’s economy. Blaming the previous Congress-Nationalist Congress Party regime for leaving behind a legacy of alarming debts and deficits, the BJP-Sena government drew up a litany of fiscal sins that it went on to embrace itself, from rank populism to rising revenue expenditure. Revenue deficit, fiscal deficit and debt stock have all grown — to Rs 14,960 crore, Rs 56,053 crore and Rs 4,14,411 crore, respectively. Revenue expenditure in 2018-19 grew to Rs 3,01,460 crore against Rs 2,41,571 crore during 2017-18. Five years ago, the government inherited a debt of over Rs 3 lakh crore, which has grown by about a third in five years, making Maharashtra one of the country’s most debt-stressed states. What has worked for the government is the growing GSDP, but it must return to its fiscal vows, broken on account of political exigencies, including increased capital expenditure, while curtailing off-budget borrowings and controlling revenue expenditure. Claims that Maharashtra is the top destination for investment have begun to appear hollow in the face of factory closures and poor job creation.
The other focus area will have to be agriculture and its allied issues of irrigation and climate-resilience in farming. Against a backdrop of promises to double farm incomes, the growth rate in agriculture is pegged at a miserable 0.4 per cent for 2018-19 and farmer suicides have peaked over the last five years. This calls for urgent attention to completing pending irrigation projects and drought-proofing chronically dry regions. A water grid for Marathwada and river-linking schemes have been drawn up, but these should be assessed on parameters of sustainability before they get off the ground. It is the less glamorous projects that need the chief minister’s attention, including creation of value chains in agriculture and incentivising sustainable cropping. Amid questions on how effective the showpiece scheme, Jalyukt Shivar, has been, an exhaustive and honest audit of water conservation works will be welcome.
Maharashtra is one of the states where the gravity of climate concerns is clear and present — in August 2019, when Western Maharashtra experienced its worst ever floods that washed out hundreds of acres of standing crop, some regions continued to experience acute water scarcity from a long drought since the winter of 2018. Some climate policies were announced in the first term, including for electric vehicles, clean fuel and sustainable transport systems. The new government will do well to act on some old plans.
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