Dhumal presents tax-free budget in Himachal


Shimla: With the forthcoming parliamentary election weighing on chief minister Prem Kumar Dhumal, on Monday he presented a tax-free budget; announced 10 percent rollback in transport fares; reduced taxes on CFL bulbs, unbranded soaps and ghee; allocated about 20 percent of the plan outlay for agriculture and irrigation schemes; and marked Rs 172 crore for three major drinking water schemes.

Dhumal, who is also the finance minister, in his second budget of the term pegged the 2009-10 annual plan at Rs 2700 crore, which is 12.5 percent higher than last year, even though it is yet to get approval from the planning commission.

With an surplus opening balance of Rs 876.41 crore, the chief minister did a fine balancing act by pegging budgeted expenditure for 2009-10 at Rs 13,075 crore against an expected revenue target of Rs 12,916 crore, leaving a closing surplus of Rs 718.05 crore. About Rs 1500 crore of the revenue target is to be met by additional borrowings. With this total outstanding debt of the state would rise to Rs 23,000 crore and would carry an guarantee liability of Rs 2593 crores.

A higher allocation that what was budgeted for in 2008-09 realised under the 12th five year plan turned a Rs 19.21 crore deficit budget into a surplus one with revised estimates.

Of the Rs 13,075 Cr Budgeted expenditure, R 3748 crore is for salaries, Rs 2053 crore against interest payments on loans raised, Rs 981 crore on loan repayments and Rs 1299 crore on pensions.

In percentage terms 29 % of the expenditure is on salaries, 16% on loans, 8% on repayments, 10% on pensions, 8% on maintenance and remaining 29 % on development.

Against an expenditure of every 100 rupees, total revenue receipts are Rs 80 and the remaining comes through loans.

To boost tourism, Asian Development Bank (ADB) had in principal approved a Rs 350 crore project. This project would devolve to the state as 90 percent grant and 10 percent loan form the central government, he said.

Likewise, the state had signed an agreement for Rs 4000 crore funding with ADB for harnessing additional hydropower. The loan would come as Rs 3600 crore as grant and the remaining as loan.

In his one hour budget speech, the chief minister highlighted launch of the Rs 353 crore new agriculture scheme “Pandit Deen Dayal Kisan Bagwaan Samridhi Yojana”, funds from which would be used for expanding poly house cultivation in a large way and for crop diversification to improve farm incomes.

insurance schemes on experimental basis would be introduced for tomato and potato crops in Solan and Una districts. For apples and mangoes it would be introduced later.

Plan outlay for roads has been increased to Rs 480 crore, which is a good 58 percent higher than the Rs 304 crore that was allocated last year.

To keep public transport Himachal Roadways (HRTC) afloat, the budget allocated Rs 120 for the service, marking Rs 43 crore for purchasing 300 new buses and Rs 77 crore as non-plan support for meeting committed expenditures.

To make rural transport viable, the budget exempted road tax on all buses plying on rural roads.

Public transport fairs, which were hiked by 25 percent last April to ward of the impact of increased oil prices have been reduced by 10 percent as prices of petroleum products have since fallen. Dhumal said that since the fuel prices are still higher than what they were when a tariff hike was announced last year, only a 10 percent reduction in fares was possible.

Of the Rs 182 crore allocated for drinking water schemes, Rs 172 crore has been marked for three major projects in Bilaspur and Kangra district. These schemes would provide drinking water to 1171 habitation, the chief minister said.

Other than setting up an IIT and medical college in Mandi a central university in Kangra, the government is facilitation setting up of four other private medical colleges in Palampur, Solan, Hamirpur and Una.

VAT on CFL bulbs, Ghee and unbranded soaps has been reduced from 12.5 percent to 4 percent.

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