The Telegraph
Wednesday , June 18 , 2014
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Budget milks fuel & liquor
Tax on petrol and diesel to go up

Bhubaneswar, June 17: Finance minister Pradip Kumar Amat today presented his maiden budget in the Assembly totalling Rs 80,139.58 crore with two tax proposals expected to fetch Rs 375 crore annually.

While the budget proposes raising tax on Indian made foreign liquor from 20 per cent to 25 per cent, the value added tax (VAT) on petrol and diesel is sought to be increased from existing 18 per cent to 20 per cent. The logic the finance minister gave for increasing the VAT on these products by 2 percentage point was that the prevailing rates in the state were lower than most other states in the country.

This means that once the budget is passed, petrol and diesel prices will rise by Rs 1.41 and Rs 1.21, respectively, per litre. Calculated on its present pricing, petrol and diesel will cost Rs 72.08 and Rs 61.85, respectively.

In tune with the state government’s emphasis on agriculture, Amat, like last year, also presented a separate budget for this sector. This aims to give a boost with public investments in farming and allied areas being enhanced from Rs 7,161.84 crore last year to Rs 9,542.22 crore during 2014-15, an increase of 33 per cent.

Though the budget, which includes non-plan expenditure of Rs 40,711.01 crore, reflects the state’s dependence on grant-in-aid from the Centre, it remains firmly focussed on fulfilling the election promises made by the government. The promises include successful organisation of Nabakalebar (change of the Trinity’s idols at the Puri Jagannath temple) next year, for which an allocation of Rs 300 crore has been made in the budget.

The emphasis on infrastructure development, as promised in the BJD manifesto, has been reflected in the budget with an allotment of Rs 150 crore for the Mukhyamantri Sadak Yojana that aims to provide road connectivity to villages not covered under the Pradhan Mantri Gramya Sadak Yojana. The government will also convert 2,35,000 kuccha dwellings into pucca houses.

In terms of departmental allocation, the school and mass education department gains the most with Rs 9,327.12 crore being earmarked for its activities while the lowest allocation of Rs 1.73 crore has been made in the case of the public grievance and pension administration department.

The focus on common man and welfare projects remains the high point of the budget, which makes an allocation of Rs 1,327 crore for the extremely popular Re-1-a-kg-rice scheme, which benefits around 57 lakh families around the state. Separate allocation has also been made for the Biju KBK Yojana to ensure the development of the state’s most backward belt consisting of the undivided Kalahandi, Balangir and Koraput districts.

Similarly, a special grant of Rs 50 crore has been made for the Western Odisha Development Council set up to formulate plans for the overall development of west Odisha districts. It is a key move of the state government so far striking regional balance in its development drive is concerned.

Education remains one of the focal areas of the state government with the budget making provisions to set up model schools in tribal-dominated districts. The government has decided to provide laptops to students at a cost of Rs 30 crore to the exchequer.

While framing the budget, the government has been particularly sensitive to the needs of the tribal communities. It promises water supply to 543 particularly vulnerable tribal groups and 1,048 scheduled caste and scheduled tribe habitations through spring and solar power-based supply system.

Chief minister Naveen Patnaik expressed his happiness with the budget describing it as pro-poor. “We have focused on pro-poor and development agenda. We have been following this since 2000,” said Naveen, reiterating his commitment to the promises made by his party during the elections.