Finance minister Pradeep Amat

Bhubaneswar, July 21: The state is facing fiscal problem due to non-release of anticipated central funds in time, finance minister Pradip Kumar Amat said today.

“We are forced to release advance towards both the state share and the central share to ensure implementation of projects within the scheduled period,” Amat told the Assembly.

“For this, we are under financial strain as we have to spend more from the state’s own resources,” he said.

The Centre’s plan cut has affected flow of central funds to the state in a big way in the past two years. For example, a meagre Rs 38 crore was received during 2012-13 as central assistance against the total expenditure of Rs 1,088.62 crore under the Accelerated Irrigation Benefit Programme.

Only Rs 15.32 crore central assistance was available under the scheme during the next year.

He said Rs 757.52-crore assistance was received from the Centre during 2013-14 under the centrally sponsored Mahatma Gandhi National Rural Employment Guarantee Scheme against its share of Rs 1,363.50 crore.

Besides, during the current financial year, as many as 66 projects under the centrally sponsored plan have been restructured and handed over to the state.

“If this trend continues, it will affect implementation of many projects and the state’s fiscal condition as well,” said the minister.

Besides, he said the state had suffered a loss of Rs 3,843.03 crore during the period between 2007-08 and 2012-13 due to downward revision of the central sales tax from 4 per cent to 3 per cent and further down to 2 per cent.

The state government has so far received Rs 1,303.08 crore towards compensation against its claim of Rs 3,843.03 crore.

The state government has demanded release of remaining Rs 2,539.95 crore at the meeting of the empowered committee of finance ministers.

“I have also raised the demand while meeting Union finance minister Arun Jaitley. Chief minister Naveen Patnaik, too, had drawn the attention of Prime Minister Narendra Modi and finance minister Jaitley in this regard,” said Amat.

The state government has also given an alternative proposal to revive the old Central Sales Tax rate at 4 percent, if the compensation for CST loss is not given.

Amat said the state government had urged the Centre to make adequate budgetary provisions at the pre-budget meeting chaired by Jaitley.

“But we have not received any financial relief from the Centre so far,” he said.

The state government has also pressed the demand for inclusion of tobacco and tobacco products in the State List, said the minister.

The state government has recently revised value added tax on petrol and diesel from 18 percent to 20 per cent and on liquor from 20 per cent to 25 per cent as a measure to augment state’s own resources to fund developmental and welfare schemes.