The Telangana government on Sunday a presented a tax-free budget for 2020-21, proposing an expenditure of over Rs 1,82,914 crore with major allocations made for farming, irrigation, social security pensions, rural and urban development among others.
An amount of Rs 14,000 crore was allocated for 'Rythu Bandhu', a flagship scheme of the K Chandrasekhar Rao-led TRS government, for providing investment support to farmers.
Noting that Rs 50,000 crore would be needed in the next five years to develop the state capital as an international city, the budget proposed an amount of Rs 10,000 crore during 2020-21 to carry out projects and development works in Hyderabad Urban Agglomeration area.
Out of the Rs 1,82,914.42 crore expenditure, the revenue expenditure is Rs 1,38,669.82 crore and capital expenditure is Rs 22,061.18 crore in the budget presented on a Sunday.
It is estimated that surplus in budget estimates is Rs 4,482.12 crore, while the fiscal deficit is Rs 33,191.25 crore, state Finance Minister T Harish Rao said in his Budget speech in the state assembly.
As per the Revised Estimates, the total expenditure in 2019-20 is estimated at Rs 1,42,152.28 crore and the surplus in revenue account Rs 103.55 crore, he added.
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The revenue expenditure is Rs 1,10,824.77 crore while capital expenditure Rs 13,165.72 crore.
Noting that the budget has been prepared against the backdrop of "overall economic slowdown gripping the Indian economy," he said consequently there is reduction in tax devolution and other transfers to the state by the Centre and decline in the growth of state revenues.
The tax devolution from the Centre to the state is expected to be lower in 2019-20 by Rs 3,731 crore as compared to the budget estimates, he said.
There are delays and shortfalls in the release of the state's share in Integrated Goods and Services Tax and GST compensation, the minister said.
Following the economic slowdown, the growth of the State's own revenues in 2019-20 (till the end of February) is estimated to be at 6.3 per cent, much below the growth of 16. 1 per cent achieved in 2018-19, he said.
"On top of this, following the recommendations of the Fifteenth Finance Commission, there will be a reduction in the share of Telangana in central tax devolution from 2.437 per cent to 2.133 per cent resulting in reduction of tax devolution by an amount of Rs 2,384 crore in 2020-21," Harish Rao said.
He, however, assured that, despite the adverse developments, the government is confident of overcoming the situation with appropriate strategies.
Because of the economic slowdown, there has been a slight decline in the growth of GSDP, in current prices, from 14.3 per cent in 2018-19 to 12.6 per cent in 2019-20, he said.
However, the decline is much lower than that of the decline in national GDP growth from 11.2 per cent to 7.5 per cent in the corresponding period, he added.
"Thus, to a great extent, the state economy has withstood the shocks of the economic slowdown across the country and maintained a double digit growth rate," the minister said.
The per capita income of Telangana at Rs 2,28,216 was greater than the country's Rs 1,35,050, Harish Rao said.
On farm loan waiver, an election promise of the ruling TRS, the government has decided to waive loans of 5,83,916 farmers who have outstanding loansbelow Rs 25,000 completely in one go, the minister said.
The government has decided to release Rs 1,198 crore in March itself to waive loans which are below Rs 25,000.
The waiver of loans above Rs 25,000 and up to Rs one lakh per farmer requires an amount of Rs 24,738 crore, he said adding it would be taken up in four instalments.
In 2020-21, for farm loan waiver an amount of Rs 6,225 crore is proposed, he said.
The Finance Minister proposed Rs 11,054 crore for the irrigation sector, Rs 11,758 crore for 'Aasara' social security pensions and Rs 16,534.97 crore for SC Special Development Fund.
He also proposed Rs 9,771.27 crore for ST Special Development Fund, Rs 23,005 crore for the Panchayat Raj and Rural Development and Rs 14,809 crore for the Municipal Department.
While Rs 10,421 crore has been earmarked for School Education Department, Rs 6,186 crore to Health Sector, Rs 10,416 crore for Power Sector and Rs 11,917 crore for Housing Department.
Talking about augmentation of resources, Harish Rao said in the backdrop of economic recession in the country, the state is "somewhat" better placed when compared with others.
By keeping track of changed economic conditions, the government was preparing suitable strategic economic plans to address the contingencies, he said.
The government has decided to sell the non-performing assets held by state-owned institutions like Housing Board in a very transparent way to raise revenues, he said, adding a robust strategy would be implemented to enhance income from sand and other minerals.
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