SRINAGAR: Presenting her fourth consecutive budget estimates for federally ruled Jammu and Kashmir, Finance Minister Nirmala Sitharaman said the Union territory will spend Rs 118500 crore in fiscal 2023-24. The estimates were presented in the Lok Sabha on March 13, 2014.
The budget has put the funds for developmental activity slightly lesser than the estimates of the current fiscal. The capital expenditure stands at Rs 41491 crore. For fiscal 2022-23 – end on March 31, 2023, the overall developmental budget was put at Rs 41335 crore. However, the documents laid on the table put the revised estimates of the capital expenditure at Rs 31785 crore only indicating a failure in spending Rs 10,550 crore.
The budget estimates suggest that Rs 33530 crore will go as salaries, Rs 11563 as pension to the superannuating staff and Rs 8641 were g to “other” heads that are part of the primary revenue expenditure. That means 38.86 per cent of the total budget will go to the staff that man the government. Against booking an expenditure of Rs 44718 crore in 2022-23, the government would spend Rs 46055 crore on salary and pension of its staff in 2023-24.
The other key committed expenditures include Rs 9635 crore as interest payment – almost eight per cent of the overall expenditure. For the current fiscal the interest payments are at Rs 9076 crore.
For debt repayments – part of the capital expenditure, the budget has set aside a resource of Rs 8099 crore. For 2022-23, the target was to repay Rs 3521 crore but the administration eventually paid back Rs 5030 crore.
Interestingly, the budget has reduced the resource allocation for power purchases during 2023-24. It stands at Rs 3040 crore. In her last budget estimates, the resource allocated for power purchase for water-abundant and energy deficit Jammu and Kashmir at Rs 5000 crore. However, the revised estimates suggest only Rs 3074 crore was spent.
The capital expenditure of a territory – state or UT – includes all resources that go into the repayment of debts, advances and loans and the developmental activities. Off late, Jammu and Kashmir’s developmental budget comprises of two major components – the central sponsored schemes and the Prime Minister’s Development Programme (PMDP) plus certain special projects that the administration intends to implement. For 2023-24, the overall funds allocated for developmental activities are Rs 33184 crore, which includes Rs 17961 crores under PMDP and Rs 15223 crore under CSS. The Jammu and Kashmir will offer a mandatory contribution of Rs 3654 crore as its share to access CSS funds.
In fiscal 2022-23, Nirmala Sitharaman budget had allocated Rs 37505 crore for developmental activities of which Rs 19074 crore was under PMDP and other allied projects and Rs 18431 crore of central sponsored schemes. However, the revised estimates laid on the table in Lok Sabha suggest an expenditure of only Rs 26537 crore has been booked, which is Rs 10968 crore less. Was it for the lack of resources or Jammu and Kashmir’s sudden lack of capacity to spend remains unknown.
In the 2023-24 budget, 28 per cent (Rs 33184 crore) would go to pure developmental activities. It was supposed to be 33.2 per cent (Rs 37505 crore) as per the 2022-23 budget. However, the revised estimates suggest only Rs 26537 crore were booked for pure developmental activities, making it 24.84 per cent of the overall expenditure for the current fiscal.
On the income side, Rs 64319 crore (32 per cent) will come from the centre as grants (UTs are not entitled to have a share in the central tax collections so the matching funds are converted into grants), Rs 13174 crore is the tentative GST collection, Rs 1800 crore is the Sales Tax, Rs 2450 crore is the anticipated excise duty and another Rs 2925 crore will come from other taxable sources. The non-tax incomes have been estimated to be Rs 13593 crore of which Rs 6000 crore is expected to be the power tariff. The budget suggested Jammu and Kashmir will have additional resource mobilisation of Rs 7800 crore in the next fiscal. It includes many items including asset monetisation.
In fiscal 2022-23, the budget estimates had anticipated receiving 34116 crore from its own resource – tax plus non-tax. However, it ended up receiving only Rs 28012 crore. Though the all tax collections were achieved, the shortfall was in power tariff collections (got Rs 4609 instead of Rs 5000 crore) and additional resource mobilisation – it has project raising Rs 8802 crore but actually manage only Rs 2484 crore, according to revised estimates put in the budget papers. In the current fiscal, the Jammu and Kashmir government saved on power purchase – spent only Rs 3074 crore against a target of Rs 5000 crore and paid more interest (on debts) which was estimated to be Rs 7427 crore but ended up at Rs 9076 crore.
In the current fiscal ending March 31, 2022, the budget details said the overall expenditure booked by Jammu and Kashmir was at Rs 102445 crore of which 35208 crore went to capital expenditure, asset creation and interest payments.
Offering an idea about the overall income for funding the budget, the official budget documents suggest that 32 per cent will come as entitled central grants: 10 per cent is borrowing (debts), seven per cent is the PMDP fund; 16 per cent will be the central sponsored scheme funds; 17 per cent is Jammu and Kashmir’s own tax revenue; 11 per cent is Jammu and Kashmir’s own non-tax revenue and the balance seven per cent will be the additional resource mobilisation.
By the end of 2021-22, the total liabilities stand at Rs 101462 crore, which is almost 52 per cent of Jamu and Kashmir’s SGDP of Rs 195118 (on 2011-12 base at current prices). The budget plans to raise loans (capital receipts) of Rs 12439 crore, which includes Rs 1505 crore of negotiated loans, Rs 10128 crore of market borrowings.
