Ahead of the Budget, Planning Commission is finding it difficult to meet the demands for various schemes by central ministries and states in the face of limited allocation being provided by the finance ministry.
Besides the direction from the ministry that adequate allocation be made for the United Progressive Alliance government's flagship programmes has made things difficult for the commission.
"Finance Secretary Ashok Jha has issued a directive that adequate funds must be ensured for education and health sectors alongwith the flagship programmes besides allocating funds to various ministries," highly-placed sources in the finance ministry told PTI.
The finance secretary in his directive has made it clear that funds will have to be provided for crucial programmes like the National Rural Employment
Guarantee Scheme, Accelerated Irrigation Benefit Programme, Bharat Nirman, Sarva Shiksha Abhiyan and National Rural Health Mission.
The directive is likely to complicate matters for the Commission in finalising budgetary allocations for various central schemes and states in view of the Ministry's stand on ensuring fiscal prudence and limiting the Gross Budgetary Support to Rs 200,000 crore (Rs 2,000 billion) despite the ministries and states seeking more than 100 per cent increase in budgetary allocations.
Political heavyweights like HRD Minister Arjun Singh, Commerce and Industry Minister Kamal Nath, Rural Development Minister Raghuvansh Prasad Singh and Railway Minister Laloo Prasad Yadav have already approached Prime Minister Manmohan Singh on inadequate provision of funds and sought a fresh look at the allocations.