June 21, 2018: The maiden Budget of BJP-IPFT Govt is distinctively unique and sets a vision for growth and revenue generation. The Budget certainly showed a decisive change in patterns of framing Budget. Reforms, populist measures and inclusive development – all were touched – some extensively and some without much elaboration. Revenue augmenting proposals like increasing road tax and levying cess on petro products are certainly jaw dropping measures for people of the State – it really never happened in past so boldly. The uniqueness of Budget also lies in its aggressive persuasion of tourism sector for job creation and inclusive development. Distribution of smart Phones to college students is one of populist measures proposed in the Budget.
The Deputy CM cum Finance Minister Jishnu Dev Varman presented Rs 16387.21 cr budget for current financial year which is 14.62 per cent higher than previous budget. Another important feature of the Budget is that it is a ‘No deficit’ budget implying equality between receipts and expenses including market borrowings. The Budget proposed marginal increase in Education and Health sectors – 1.31 per cent hike in Education while 1.27 per cent increase was proposed for Health and Family welfare.
Even if the quantum of hikes is not much remarkable, it demonstrated Govt’s vision for long term growth strategies focusing on Human Resource development. Allocation in Education sector envisages expansion of education facilities to vulnerable segments – SC/STs upholding principle of inclusive development. Also, providing facilities for horning skills necessary to be successful in All India Exams like, IAS will benefit the students of the State. In Health sector, the Govt has planned to overhaul the service delivery system – but marginal increase may ruin chance of any short term benefit.
Increase in road tax and cess on petro-products will augur well for revenue generation but these steps may proveb to be counter productive – relating to unabated price rise. However, considering that most of revenue to be generated from additional tax and cess will be utilized for road development – this might be a reason for optimism because, economic activities like road development will create earning opportunities leading to augmented purchasing power mitigating price rise issue. However, in this case, the deftness of Finance Minister will be tested and it will be important as to how quickly he can start invest revenues for productive developmental works.
Thrust on Tourism sector have already been in discussion and innovative ideas like opening forests for tourists are likely to bring positive impact in medium-long term basis. Boom in tourism sector will also address long standing issue of unemployment.
A major proposal relating to allocation for Rural Development and Panchayat may prove to be critical. In a situation when there is allegations of food crisis – and devastating flood, proposal to slash RD allocation may trigger some negative impacts. With social security pensions temporarily stalled due to procedural reasons, cut in RD and Panchayat allocation is likely to hit development initiatives of the Government. This year, budget allocates Rs 1278.74 crore (7.82 per cent) for RD and Panchayat while it was Rs 1589.35 crore (9.96 per cent) in last year’s Budget.
With sharpened knife on RD, Jishnu Dev Varman left PDS almost unchanged and announced continuation of ‘Distress Para’ concept and supplying free rations in those Paras.
Another important statement relating to beneficiaries of social pension is important – particularly in the wake of cut in RD allocation. In his budget speech, the Minister mentioned more than 4.22 lakhs persons would be the beneficiaries under the social pension scheme and this number is much higher than number mentioned in previous budget. Further, Jishnu Dev Varman has proposed to allocate “more than 300 crores for payment of various Social security pension schemes”. In the backdrop of social security cover to such an extent, it will be prudent that the Government expedites process for restoration of pension payment will augment purchasing power of people.
The Budget – in short term may cast negative results, however, if the Government can maintain transparency and adhere to its policies for revenue generation along with holistic development, the State may experience growth in the long term. (Published in Tripura Times on June 20, 2018)