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Tax-free, Rs 857-mn deficit Budget for Andhra Pradesh

Syed Amin Jafri in Hyderabad

A tax-free, Rs 856.8-million deficit Budget for the financial year 2002-03 was presented to the Andhra Pradesh Legislative Assembly by state Finance Minister Yanamala Ramakrishnudu on Thursday.

The finance minister said that the annual plan outlay for the state has been stepped up to Rs 100.83 billion in the ensuing financial year. This represents a hike of 21 per cent over the revised plan outlay of Rs 83.29 billion for the current financial year 2001-02.

During the financial year 2002-03, the state has alloted Rs 281.2 billion under non-Plan and Rs 112.99 billion under Plan, including centrally sponsored schemes. This would result in a revenue deficit of Rs 24.82 billion, which would work out to 1.5 per cent of the gross state domestic product. Fiscal deficit is estimated to be Rs 74.99 billion, which would be 4.5 per cent of the GSDP.

After taking into account the overall transactions of the year, the state would have a net deficit of Rs 673 million. With the negative opening balance of Rs 184 million, the financial year is expected to end with a negative balance of Rs 856.8 million.

The minister said that since the year 2002-03 was going to be the first year of the tenth five year plan, the annual plan outlay for the year has been projected to cross the Rs 100 billion mark for the first time. The plan outlay has been hiked for all the sectors, including agriculture, irrigation, power and social services.

He said that the state had released the draft Budget proposals (annual fiscal framework for 2002-03) for open discussion.

Andhra Pradesh was the first state in the country to have invited public debate and constructive response from the public as part of the exercise of formulation of state Budget for the year 2002-03.

The Budget reflected the critical priorities indicated by the people of the state through their suggestions.

The government had also released the fiscal reform strategy paper highlighting medium term fiscal framework for the period from 2002-03 to 2006-07, the terminal year of the tenth five-year plan.

The government had released 15 other strategy papers covering sectors such as agriculture, irrigation, health, education, welfare, local bodies and poverty eradication for public debate.

Based on the feedback received from the public, the government has modified allocations to several vital departments.

In the overall economic context, the government has decided to set up an agricultural development fund with a contribution of Rs 750 million to improve agricultural productivity and production.

The government has decided to enhance allocations for the irrigation sector to create additional potential on a fast track basis.

Further, the government has allocated Rs 100 million as a token contribution towards the market intervention fund to assist and enable the farmers to face the challenges of the World Trade Organisation regime.

Provisions have also been enhanced for improving the infrastructure for rapid industrialisation and augmenting water supply for Hyderabad and other cities. Employment generation and welfare programmes have also been strengthened.

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