Finance Minister Abdul Rahim Rather has presented the fifth consecutive annual budget of NC-Congress Coalition Government for the financial year 2013-14. He has claimed that the economy of the State was growing at 7.01 per cent this financial year while it was expected to grow at 8 per cent during 2013-14 as against Union Government’s 6.5 per cent target of next fiscal year. For current financial year, the Central State Organization (CSO) had projected the Centre’s economy to grow by 5 per cent only, which meant the State was well ahead of the Union Government in economic growth.
Whether this growth is real shall have to be assessed in the background of the fact that out of the total budget of the State, nearly 51 per cent amount would be coming from the Centre. The State would also be getting 12 per cent amount of the budget as State’s share from Central taxes. Finance Minister has announced total budget estimate at Rs 38068 crore and revenue expenditure, including Security Related Expenditure (SRE) at Rs 28690 crore with Capital Expenditure (CAPEX) of Rs 9378 crore. Marginal income has been shown coming from bringing some items under VAT while remission of VAT on a number of other items is also proposed and these are mostly those that had not invited it during the past year. However, relief for the industries would continue till the end of financial year 2014.
Finance Minister has imposed total ban on import, manufacturing, transportation, stocking and sale of chewable tobacco and products like pan, masala, gutka, khaini etc, and increased rate of Value Added Tax (VAT) on cigarettes and related products including raw tobacco and brought more services under the tax net from next financial year. But curiously, he has not suggested any hike in the price of liquor. This shows clear divergence of view on the question of promoting public health as a concern of the Government. Gutka, masala, khaini etc. are known for their injurious effect on health, and hence imposition of ban is justified. Though smoking is no less injurious, hike in the price of cigarettes has been announced to garner more revenue. But why liquor has been left out of the loop of price hike since it too is injurious to health remains a mystery. There is public disapproval of adopting double standards. We know that there is a liquor lobby in the State especially in Jammu region which carries a clout with sections of ruling apparatus. Finance Minister would do well to revisit his decision of not hiking the price of liquor as a deterrent to drinking habits of the people.
The budget does not suggest any attempt of getting hold of more affluent segments of society most of whom are said to be among tax evaders or adepts at making black money. Land mafia, liquor mafia and tax evading mafia remain outside the tax net of the Finance Minister. Some marginal increase in the funds allocated for purchase of power has been suggested but that is not going to make any real impact on the ground because of a wide gap between supply and demand of electric power in all the three regions of the State. There are no significant measures suggested for overcoming pilferage of power. Again there are no suggestions how an enormous amount of more than 1300 crore rupees as arrears of electric bills pending mostly with various departments of the Government or VIPs can be realized.
This notwithstanding, some of the measures suggested are encouraging. Fixing the remuneration for the Sarpanchs and Panchs at rupees 2000 and 500 per month respectively should serve as incentive to these grass root level functionaries to perform their duty honestly and with clear nationalistic vision. The Government has already brought the village headmen or Lambardars on the pay roll as they are key to the maintaining of law and order in their villages. Finance Minister has suggested rupees three hundred for each sitting of panchayat subject to a maximum of 600. This may not be really adequate because the panchayats have to meet very often to run public business.
For the Government employees and pensioners, the budget brings the good news that the Finance Minster has allocated 700 crore rupees for payment of Dearness Allowance to the employees and pensioners besides 842 crore rupees to cover the arrears of pay and pension accruing to them from 6th Pay Commission recommendations. For daily wagers there is a marginal hike from rupees 125 per day to rupees 150 per day. The decision to reduce VAT on food items served in hotels from 13.5 per cent to 5 per cent is also a good gesture.
No special incentives have been proposed for the development and growth of industries. There are no solid proposals for eradicating unemployment among the educated youth nor are there any new incentives that would attract them to self employment activity. But of course the humanitarian proposal of helping destitute parents with a relief amount of thirty thousand rupees to marry off their grown up daughters is a welcome step. It has to be ensured that the amount given in aid goes to the really deserving persons. Similarly financial aid proposed for cancer patient is also in the category of humanitarian relief and should be appreciated.
In overall estimation, we may not call it election oriented budget because the Finance Minster will have to present one more budget before the new Government is constituted in the aftermath of 2014 elections.
In overall estimation, we may call it a balanced budget with some fresh initiatives aimed to garner additional resources.
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