Telangana State budget presented by Finance Minister T Harish Rao on Sunday could be summarised as being unrealistic, constrained and promising only some incremental changes with no bold allocations. While the State has increased the size of the 2020-2021 Budget as compared to previous year, the very size of it is questionable.
Tax revenue accruals have significantly come down, economy is hurt by recession, resource transfer has declined to the State by Rs 4,500 crore and is expected to decline by Rs 2,400 crore due to implementation of interim report of fifteenth finance commission and GST compensation of around Rs 933 crore is pending.
In spite of such decline in revenue, the State government has presented an inflated budget, indicating that real expenditure will be much less than budget allocations.
On top of this, the State government was bound by politically committed expenditures like Aasara pensions, Kalyana Lakshmi, Rythu Bandhu, farm loan waivers, constraining how much money can be allocated to sectors like education and health, leaving no fiscal space for finance minister to operate.
All this resulted in only incremental allocations for a few schemes and restricting the government from making any bold allocations.
There has been no strong emphasis on job creation or skill enhancement.
Two noticeable initiatives in this budget are Rs 10,000 crore allocation for Hyderabad agglomeration and Rs 300 crore allocation for developing tourism along Godavari river front at Kaleshwaram reservoir.
Hyderabad is growth engine of State and is home to one fourth of State’s population. However, it is to be seen if this is allocation is new or just a pooled show of existing expenditures. Kaleshwaram tourism project is the right step in direction of infrastructure tourism.
(The writer is a former MLC.)