With the crucial Panchayat elections barely a few months away, Bengal finance minister Amit Mitra tabled a state budget where agriculture and rural development easily formed the largest chunk of the budgetary allocation pie chart. The allocation of Rs 23,920.87 crore under this head for the upcoming fiscal is nearly double that of the revised plan estimates for the current year.
The Bengal budget was tabled a day ahead of the Union budget following a revision from the earlier schedule to table the state budget on the same day as the central budget on 1 February. This was the second consecutive year that, drifting from convention, the state budget was placed before the Union budget was tabled.
Besides enhancing allocation, Mitra also announced new schemes and extended tax exemption proposals aimed at benefiting largely the state’s rural and semi-urban population.
The most noteworthy among them was the introduction of ‘Rupashree’, a scheme to extend one-time marriage assistance of Rs 25,000 to the family of a girl with an annual income of Rs 1.5 lakh or less after she attains 18 years of age. Mitra proposed an allocation of Rs 1500 for this scheme.
The finance minister also enhanced the annual scholarship for girl-child education from Rs 750 to Rs 1,000 under the state’s flagship ‘Kanyashree’ social welfare scheme that costs the state exchequer an annual Rs 1,200 crore. Mitra claimed that the scheme has already empowered 4.5 million students and has drastically reduced dropouts from schools.
Among other announcements for farmers in his budget statement, Mitra proposed a total exemption of mutation fees for agricultural land, creation of a Rs 100 crore corpus fund to prevent possible distress sale of farm products and enhancement of monthly old age pension for farmers from Rs 750 to Rs 1,000.
Mitra also announced a 1 per cent reduction in stamp duty on properties valued at Rs 1 crore or less.
In his bid to address the financial distress of the ailing tea industry in the state, Mitra proposed that tea gardens be fully exempted from payment of agricultural income tax for two subsequent financial years and be fully exempted from payment of education and rural employment CESS for the 2018-19 fiscal.
Significantly, however, Mitra reduced allocation for Water Supply, Sanitation and Urban Development from Rs 13,188.13 crore revised estimate of the current financial year to Rs 10,901.96 crore for the upcoming fiscal. Among other heads which suffered a scale down are Health and Family Welfare and Transport.
But it was the policies of the Centre that Mitra and chief minister Mamata Banerjee chose to attack during an interaction with the media following the tabling of the budget at the state Assembly. And it was the “faulty implementation of the Goods and Services Tax and demonetization" which they claimed was at the root of the state’s financial distress. Besides, of course, the debt burden of an estimated whopping Rs 3,94,832.23 crore which Bengal would have to shoulder in the upcoming fiscal.
“Bengal has suffered a revenue loss of Rs 1,850 crore on account of GST implementation. The Centre has compensated us about Rs 1,000 crore so far. The remaining Rs 850 crore, which it is Constitutionally obligated to provide, is yet to come,” Mitra alleged.
Banerjee alleged that the Centre’s decision to change the date of devolution of tax revenues to states from the 1st to the 15th of each month has resulted in a cash-management crisis. “The Centre may be holding back the money. But we are having to meet our salary payment obligations at the beginning of the month itself. The crisis is being faced by all states and not just us. I appeal to the Centre to reconsider this decision,” the chief minister said.
“The decision was taken unilaterally by the Centre without consulting the states. It’s a body blow to the country’s federal structure,” Mitra added.
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