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No fund for new memorials in Budget
February, 05th 2010

Yawning deficit and mounting debt are the telltale features of the states annual budget presented without any new taxes for the year 2010-11 in the Vidhan Sabha here on Thursday by finance minister Lalji Verma.

While no fresh allocations have been made for parks, memorials and statues this time, the consolidated deficit of Rs 9022.11 crore has been left to be covered in the annual spending plan of Rs 153199.38 crore.

Notably, the fiscal deficit, consisting of the revenue deficit and the capital outlays, touched a whopping Rs 22742.49 crore, which is 4.4% of the Gross State Domestic Product (GSDP). However, the two supplementaries sought by the government have been kept out of consideration and if they are taken into account, then the fiscal deficit would be far more than that admitted in the budget literature.

The major cause of concern is the states indebtness that stands at around Rs 1,85,000 crore as of now. This works out to be over 40% of the states GSDP. The annual repayment installment of this loan comes to around Rs 19190.21 crore, almost half of the states annual plan, which is pegged at Rs 45645.13 crore.

There was a deafening silence in the House when the finance minister (FM) read out his 43-page printed speech for almost 65 minutes in the House. Chief minister Mayawati and Leader of Opposition Shiv Pal Singh Yadav of the Samajwadi Party were also present.

Though sparing people from any new tax, the FM promised to mop up Rs 144177.27 crore through revenue receipts and plug the deficit through Rs 7002 crore lying in the public account. He further said that if Rs 3433.79 crore balance of last year was taken into account, then the budget showed a surplus of Rs 1413.68 crore.

The budget, however, contained several dramatic steps, but managed to hide more than it revealed. For example, it was not immediately clear from where the additional resources would be mobilised by the government to meet its projected target of revenue receipts of Rs 144177.27 crore and reduce the borrowings, which were constantly swelling.

The budget brief prepared by the finance department, however, pins it hope on revenue receipts of Rs 111620.61 and Rs 32556.66 crore as capital receipts. Apart from this, it also indicated a target to secure external assistance and also hinted at enhanced financial assistance from international institutions.

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