Chief Minister Conrad K Sangma on Thursday tabled a Rs 1,532 crore deficit budget in the Assembly for the financial year 2020-2021 which is 3.53 percent of the Gross State Domestic Product (GSDP).
The total receipts for 2020-21 is estimated at Rs 17,375 crore of which the revenue receipts are estimated at Rs 15,353 crore and capital receipts at Rs 2,022 crore, Sangma said in his budget speech.
Excluding borrowings of Rs 1,995 crore, the total receipts are estimated to be Rs 15,380 crore, he said adding that the total expenditure is estimated at Rs 17, 432 crore, of which the revenue expenditure is estimated at Rs 14,428 crore and capital expenditure at Rs 3,004 crore.
According to the chief minister who holds charge of the Finance department, the estimated total expenditure is Rs 16,912 crore excluding repayment of loans of Rs 520 crore.
He said the interest payments for 2020-21 are estimated to be at Rs 843 crore and pension payments at Rs 1,208 crore.
“I am, therefore, presenting the budget of 2020-21 with a fiscal deficit of Rs 1,532 crore, which is around 3.53 percent of the GSDP,” Sangma said.
“Along with the Budget, I am presenting the vote on Account for proposed expenditure during the first three months for 2020-21,” he said.
The chief minister said the government’s goal is for Meghalaya to be amongst the top ten Indian states, in terms of per capita GDP and achievement of Sustainable Development Goals, by 2030.
“This target is not merely aspirational, but certainly achievable and we have a clear strategy to achieve it,” he said.
“Our strategy revolves around prioritizing the four core pillars of Human development, primary sector, infrastructure and entreprenuership. Improvement in Governance and caring for the environment will be cross cutting measures guiding our strategy,” he added.
Stating that the operationalization of the strategy will require critical investments in all these focus areas, Sangma said this budget provides the framework for those crtical investments.
“An important underlying theme of this year’s budget is the creation and upgradation of basic infrastructure at all levels including schools, hospitals, roads, water supply, banking and administrative infrastructure,” he said.
Stating that the state is largely dependent on transfers from the Centre, for meeting both its revenue requirements and for makng capital investments, he said our own resources, tax and non-tax, constitute only about 20 percent of the state’s total revenue receipts.
Against this background, Sangma said that the government has prioritized monitoring the revenue collection through periodic review meetings.
“For 2019-20, the revenue collected by the taxation department is expected to touch Rs 1,632 crore, thus registering a growth rate of 12.4 percent,” he said.
He further informed that the overall tax revenue, including Goods and Services Tax, Excise and Motor Vehicle Taxes will reach Rs 2,015 crore for 2019-20.
For the year 2020-21, he said the governemnt is putting in place a full system of data analytics to aid in increasing the efficiency of revenue collection.
He said that the National Green Tribunal’s approval for auction of 2 lakh metric tonnes out of the 32 lakh metric tonnes of extracted coal is a welcome development.
Expressing confidence that the revenue collection of the state will improve signficantly in the next financial year, Sangma said, “For 2020-21, i have estimated Rs 2,377 crore and Rs 690 crore for tax and non-tax revenue collection respectively.”
The chief minister further informed that the Fifteenth Finance Commission has increased Meghalaya’s share of the total divisible pool from the previous 0.642 to 0.765 percent.
“The total grants recommended for Meghalaya for the year 2020-21 stand at Rs 7,417 crore,” he announced.
Of this, Rs 6,542 crore is the tax devolution, Rs 491 crore is the revenue deficit grant, Rs 182 crore and Rs 88 crore are grants to rural and urban local bodies respectively, Rs 66 crore is state disaster risk management fund and Rs 48 crore is the grant for nutrition.
He said deviating from previous practice, the Commission submitted an interim report and made recommendations only for one year.
“This gives us an opportunity to engage with the Commission in the coming months to convince them to increase our allocations even further for the four-year period 2021-25,” Sangma stated.
Regarding the increased tax devolutions and revenue enhancing measures taken up by the government, the chief minsiter said that he was able to increase the development budget from state’s resources to Rs 3,300 crore for 2020-21.
“This is a 45 percent increase over the previous financial year and the largest in the history of the state,” he said while also highlighting that the development budget from state’s resources has never crossed Rs 2,600 crore in the past five years.
He added that combining the state and central resources, the total development budget for 2020-21 is estimated at Rs 8,616 crore.