How Telangana budget has to be viewed?

By: Fatima Hasan

When the State Budget is presented, it is usual for the opposition to heap criticism on the government and move cut motions, followed by protests. This time, when the Telangana budget for 2019-20 was presented in the State Assembly, amidst economic slowdown in the country, it gave a new weapon to the opposition to cite the failures of the government. State BJP spokesman was quick to attack the government on the budget. “With lack of fiscal prudence, discipline and a vision, the state’s finances today are in serious mess. The government has funds neither for welfare nor development. It is a state narrative of white lies delivered by CM KCR,” he commented.

The State budget for 2019-20 has total outlay of Rs 1,46,492 crores. This is clearly 19.5% less than the Vote On Account Budget presented in February 2019 that showed an outlay of Rs 1,82,017 crores. The budgetary outlay has been slashed this time because of the economic slowdown in the country. Telangana Chief Minister K Chandrasekhar Rao is optimistic that there are ways for raising additional funds by selling the government lands. But, the larger question here is how is the first budget of re-elected  Telangana Government  to be viewed —in the light of positives or in the shadow of negatives vis –a-vis the  poll promises of TRS and the Vote On Account in February.

The main reason stated for the less budgetary allocations to various departments is the financial position of the State government in the wake of economic slowdown in the nation. Hence, it is necessary to figure out if there are other reasons to it, as alleged by opposition, or if only the economic slowdown is to be blamed and how much of it is impacting Telangana. Another probable reason could be the less allocation to States in the Union Budget for 2019-20 and refusal to provide Central funds for Kaleshwaram lift irrigation project by recognizing it as a national project.  

Compared to the last year’s budget estimate of Rs 1,74,454 crores and revised estimate of Rs 1,61,223 crores, this year’s budget is lower by 16 percent and 9 percent respectively but a closer analysis of the allocations to various schemes indicates its positive side. The flagship scheme Rythu Bandhu, under which financial assistance to farmers has been increased from Rs 8,000 and Rs 10,000 per acre per annum, is allocated Rs 12,000 crores. For the new farm loan waiver scheme, an amount of Rs 6,000 crores is allotted and for Rythu Bhima scheme, a sum of Rs 1,137 crores is allocated.  Power subsidy of Rs 8,000 crores is provided for free power given to the farm sector and for payment of the electricity bills for supplying water from lift irrigation projects to agriculture lands without passing the burden on to the farmers.

Moreover, keeping his poll promises, KCR has doubled the pensions provided under the social security pension scheme—Aasara. Allocation of Rs 9,402 crores is made for Aasara pensions. Old age pension eligibility under this scheme has also been reduced from 65 years to 57 years, thereby covering more beneficiaries.  The CM has even listed out various ways through which the funds can be raised and how, only after checking the cost-benefit ratio, the central schemes will be implemented to reduce the expenditure in the State.

Few departments have seen saw an increase in allocations. Agriculture and allied activities get 30 percent more than the last year’s revised estimate, energy sector allocation is increased by 61 percent and social security and nutrition by 32 percent. However, other key departments have seen a hefty cut. Allocations for water supply, sanitation, housing and urban development are less by 69 percent. SC,ST, BC and minority welfare outlay is less by 39 percent, followed by rural development with minus 32 percent, health and family welfare  minus 25 percent, education minus 24 percent and police minus 10 percent. 

Talking about his party’s take on the State budget, AIMIM MLC , Syed Amin Ul Hasan Jafri, said, “As per the circumstances, where there is economic slowdown in the country, Chief Minister KCR cannot do much. So, it’s OK but what we want is that the however less the amount allocated for minorities welfare scheme is, it has to be released fully and no further cuts should be imposed. As far as the state is concerned, the economic slowdown impact is there since one and a half years and we are just hoping it will soon subside in coming months. May be, the State budgetary position will improve next year.”


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