BENGALURU: Compared to last year, revenues for Karnataka may be slightly better this fiscal year, despite the Covid second wave and partial lockdown. Revenue receipts from various sources this time have been better than last year during the same period, officials said, but uncertainty looms with the third wave around the corner.
Additional liabilities following heavy borrowings last fiscal year, pending GST dues as well as reduced allocation of funds from the Centre this year too have left Karnataka’s finances in a precarious position. With Covid management taking priority, funds (sanctioned, allocated or saved) from various departments are being channelised for medicines, awareness, vaccines, infrastructure, financial aid etc to fight the pandemic. From big schemes to PD accounts of deputy commissioners and gram panchayat allowances, funds are being diverted to assist Covid management.
At a recent video-conference with gram panchayat members, Chief Minister BS Yediyurappa said that funds diverted to each gram panchayat account from the State Disaster Relief Fund should be utilised towards Covid management. While the State government is diverting funds from other departments, delays and allocation cuts by the Centre are making things difficult.
As per the Union Budget 2021-22, Karnataka’s share in the Central pool of taxes by way of devolution is about Rs 24,000 crore. The Centre pays this in 14 monthly instalments. While Karnataka should have received around Rs 1,700 crore per month, it has got only Rs 1,429 crore in this fiscal year so far. Also, Karnataka has not received a single instalment of its GST compensation this financial year and is waiting for Rs 11,000 crore in dues from the Centre.
“We have received Rs 2,700 crore in grant-in-aid so far,” said an official from the Finance Department, confirming the other numbers.“While the dent in revenues may be lesser than last year, it is too early to predict if this trend will continue. It depends on what happens once the lockdown is lifted and how markets react to it,” said another official from the department. Shorter lockdown duration, keeping industries open with restrictions, allowing construction and related activities etc, seem to have helped, but the State is also incurring additional expenditure this fiscal year.
“The Rs 1,850 crore economic package, announced by Chief Minister BS Yediyurappa recently, will be an
additional expenditure on the budget estimates.While we have instructed departments to use funds that have been carried forward or already allocated to start disbursing aid, additional costs will be shown as revised budget estimates,” a senior official of the Finance Department said.
Karnataka gets Rs 135.92 crore from Centre
In its third instalment of revenue deficit grant from the Centre, Karnataka received Rs 135.92 crore. The state has so far received Rs 407.76 crore under the head. As per the 15th Finance Commission recommendation, the state is eligible for Rs 1,600 crore.