Asserting that the basic theme of Budget 2018-19 is to revive JK’s economy and promote endogenous growth through enhanced public expenditure, Minister for Finance, Dr Haseeb Drabu today said the local fiscal system got shattered because of the 2014 floods, 2016 disturbances, demonetization and GST and needs to be put back on track through sustained interventions.“We are steadily moving towards putting in place a wide-ranging public expenditure policy in the State so that the money keeps continuously flowing and circulating in the system to keep local economy enduring,” Dr Drabu said while winding up the discussion on the Budget proposals for 2018-19 in the State Assembly here this evening.
He said the Government has benefitted a lot from the exhaustive debate in the House on the Budget proposals and the learned Legislators have provided many valuable inputs for making the Budgetary exercise more fruitful. “I am grateful to the Legislators for their valuable inputs on the Budget,” he said.The Finance Minister said that the measures announced in the Budget would facilitate greater inflow of cash in the system which would go a long way in the revival the sagging local economy.Defending his decision of extending various financial benefits to the employees, he said there are 4.5 lakh employees and every employee has a family of at least five persons. “That means that a population of more than 20 lakh souls is directly linked to the government.
If they spend, the economy improves, if they save it also helps,” he said and added that the same dictum is the main reason for amnesties that were part of the budget. “When we announce some amnesty, we actually write off somebody’s liability and when there is no liability, it automatically becomes income,” he explained.Dr Drabu said with the unflinching support of the Chief Minister, Ms Mehbooba Mufti and his cabinet colleagues, he has been able to make various structural interventions in the State’s financial system which have immensely helped improve public expenditure management and “now we need to take the expenditure to the ground and take the benefits of those gains to the people at the grassroots level.”He said the focus of the renewed fiscal policy is to enlarge constituency of peace, restore dignity of the state and its people and make it relevant for the times that we live in and essentially for the stakeholders. “This is perhaps the first budget that is not about the government departments but the stakeholders encompassing every section of the society including poorest of the poor, marginalized, employees, traders, industrialists, agriculturists, women, girls, students, youth and destitute,” Dr Drabu said and added that he wanted to make this budget relevant for the times and the people of the State and its economy. “And I am contended that I have achieved the objective to a significant extent,” he said and added that with the budgetary edifice in place, now is the time to consolidate the fiscal and budgetary reforms at the departmental level for sustained and self-generating efficiency gains.Reiterating that the system building started in 2015 has a positive impact, Dr Drabu said the biggest proof is that perhaps for the first time in the budgetary history of J&K, the revised estimates for the current year are much better than the budget estimates that he had presented last year.Enumerating he said, three numbers stand out: tax revenues were estimated to be Rs 9931 crore. These have been exceeded and in the process, we have crossed the Rs 10000 crore mark of own tax collection. “Second, I had estimated an unfunded resource gap of over Rs 3000 crores. As the year comes to an end, I have a surplus of more than Rs 1300 crore. Third, the fiscal deficit which is regarded to be the single most important indicator of fiscal performance was estimated at around 9.5 percent but has actually turned out to be around 5.7 percent; an improvement of nearly 400 basis points.
This is unprecedented,” he said and added that because of a well-run financial setup, the Govt is now able to take decisions that change lives of the people for good, especially for the most vulnerable and marginalized.Dr Drabu said the Government is at the same time trying to bring up a new rural fiscal architecture by linking Panchayats with Rural and Cooperative Banks. “We want to effectively revive the institutions of rural local governance in the State with a sustainable supportive fiscal system side by side,” he said and added that the capital infusion of Rs 250 crore to three Cooperative Banks and the decision to connect these banks with the Panchayats will provide regular fund flow to these banks. He said a parallel financial structure has been initiated for empowering the Panchayats and further boosting the rural economy.Speaking on the recent initiative taken by the government for construction workers, the Minister said that in the last three years, the funds have been increased for their welfare including insurance cover, overdraft facility and other measures for the construction workers.Elaborating on the provisions kept in the Budget for Agriculture, sector, Dr Drabu said that the focus of the government is to promote commercial agriculture to transform the rural economy for which the spending is more than 10 times. He further said that Horticulture is a major part of agriculture sector and thrust is on professionalizing these sectors to generate more employment.The Finance Minister said that the government has recently increased the minimum wages of un-skilled, skilled and highly skilled workers and this move will in turn raise the market wages prevailing in the state thereby increasing the incomes of the poorest. He further said the proposed uniform Labour Code will be a landmark initiative for the welfare of the labourers.Defending the decision of keeping the Toll Tax regime intact in the GST era, Dr Drabu said it is vital to the policy making in the state.“It is not a matter of revenue as that is too small an amount,” he said. “It is vital to the requirements of the state to know what and how much comes and goes out of the State. It is the only gateway we have and the information is required for the protection of the local industry. Trade balance is something that we must always know and the gap in it is surging.”
Dr Drabu said the toll tax has been there since 1938. Between 2003 and 2010, it increased by half and now it saw a marginal shift and it has suddenly become an issue. “Toll is more important for protection of local industry,” he said.Responding to the concerns of the Legislators regarding J&K Bank, Dr Drabu assured the House that although he favours complete autonomy in the functioning of the Bank, but as a regulator he will take the requisite measures to address the issues concerning the Bank. “We would look into the issues, if any, in the JK Bank and ensure that its functioning is made more transparent. However, it should not be a reason for getting the issue to the House for a debate because it has costs for the finance institution,” he maintained.Earlier, 38 Legislators participated in the 12 hour long discussion on the Budget which was presented by Dr Drabu in the House on 11 January 2018.The members who participated in the Budget debate included Raja Manzoor Ahmad, Mohammad Shafi Uri, Rajesh Gupta, Nawang Rigzin Jora, Shah Mohammad Tantray, Devender Singh Rana, R S Pathania, Hakeem Mohammad Yasin, Asgar Ali Karbalai, Mohammad Yousuf Tarigami, Sat Paul Sharma, Ali Mohammad Sagar, Yawar Ahmad Mir, G M Saroori, Abdul Majeed Paddar, Bashir Ahmad Dar, Dr. Devinder Manyal, Sheikh Ishfaq Jabbar, Javid Hassan Beigh, Altaf Ahmad Wani, Javid Ahmad Rana, Sukhnandan Kumar, Noor Mohammad Sheikh, Usman Abdul Majid, Neelam Kumar Lengah, Pawan Kumar Gupta, Syed Mohammad Baqir Rizvi, Mian Altaf Ahmad, Er Abdul Rasheed, Shamim Firdous, Daleep Singh Parihar, Choudhary Qamar Hussain, Deldan Namgyal, Shakti Raj Parihar, Abdul Majid Larmi, Abdul Rahim Rather and Dina Nath Bhagat.