Calcutta, Nov. 19: Finance minister Amit Mitra crowed about things pleasant, such as growth in the state’s tax revenue collection today, but stayed mum on things unpleasant, like high market borrowing and overshooting allocation for non-plan expenditure, when he met members of a city chamber of commerce.
Mitra did not miss the opportunity, on the sidelines of a merchant chamber event this afternoon, to highlight the state’s achievement of raking in Rs 14,176 crore in the first half of the ongoing fiscal year, 35 per cent higher than the same period last year.
The state has set a target of collecting over Rs 31,222 crore for the ongoing financial year against that of Rs 24,934 crore the previous year.
“This collection in the April-September period amounts to 45 per cent of the tax revenue collection target. I am confident that the target for the year would be met,” said the finance minister.
Attributing the growth to “better tax compliance” and the implementation of electronic methods of collection, Mitra pointed out that the thrust of his department had been on providing “a transparent and efficient administration” through e-governance and simplification of rules and procedures.
But the areas Mitra did not touch upon, such as having to resort to borrowing or juggling funds from one account to another for managing the working capital, are of greater concern in his department.
Foremost among them is the rapid depletion of the market borrowing quota, which stands at Rs 20,528 crore for the fiscal.
The Telegraph had reported on November 12 that a surge in non-plan expenditure — the other key area of concern — was holding up several development projects in backward areas, underscoring the incongruity between the populist profligacy and the avowed pro-poor priorities of the state government.
Though Bengal, according to government sources, could be allowed an additional borrowing Rs 2,293 crore this year on the basis of loans repaid, it won’t help cut much slack as it reels under a debt burden of over Rs 2.18 lakh crore.
“We have borrowed Rs 12,500 crore from the market. Tomorrow, we are going for another round of borrowing of Rs 1,500 crore. Besides, the Rs 2,200 crore Asian Development Bank loan is most likely to be added to our market borrowings,” said an official who pointed out that “the lion’s share” of the borrowings was utilised for payment of salaries and pensions.
Salaries and pensions comprise over 70 per cent of the state’s non-plan expenses, which are expected to surpass allocation — of over Rs 82,000 crore — by at least Rs 300 crore.
According to Writers’ Buildings sources, several senior officials in the government have expressed “concern” about the state’s fiscal profligacy despite limited resources and a huge debt burden.
As of March 31, Bengal’s total debt was Rs 2,08,382 crore and it is expected to balloon to at least Rs 2,31,203 crore by March 31 next year.
“The finance minister, therefore, can take little comfort in meeting 45 per cent of the revenue collection target in the first six months when the state has exhausted well over 70 per cent of its market borrowing limit within the first eight months,” said a senior bureaucrat.