No State is immune from the impact of economic slowdown affecting virtually every sector in the country. However, Telangana, India’s youngest State, has done well to weather the storm and stay on a determined course that enables seamless blending of welfare with development. Despite the severe financial crisis in the wake of reduced flow of Central funds and revenue collections, the State has demonstrated its unflinching commitment to continue the welfare programmes that touch the lives of millions of people, be it farmers or weaker sections. The full-fledged Budget for 2019-20, presented by Chief Minister K Chandrashekhar Rao in the Assembly, reflected a prudent and balanced fiscal approach in the face of adverse situation. The Chief Minister’s assertion that his government’s flagship welfare programmes like Rythu Bandhu, free power for farmers and Aasara Pensions would continue to receive undiluted attention is very reassuring at a time when there is gloom all around. The generous budgetary allocations for these key initiatives — Rs 12,000 crore for Rythu Bandhu, Rs 9,402 crore for Aasara and Rs 8,000 crore for free power — shows the government’s commitment to welfare. Moreover, the electricity bills for supplying water from irrigation projects to agriculture lands will also be paid by the government without burdening the farmers. Overall, the Budget is pegged at Rs 1.46 lakh crore as against Rs 1.82 lakh crore proposed in the interim Budget earlier this year. There was a fall in the revenues of both the Centre and the State due to the economic slowdown.
Consequently, the revenue expenditure has been scaled down from Rs 1.31 lakh crore to Rs 1.11 lakh crore while the capital expenditure has been slashed from Rs 32,815 crore to Rs 17,274 crore. This is because the State had to revise the Budget estimates keeping in view the impact of slowdown over the last few months. Maintaining fiscal discipline by cutting down wasteful expenditure by various government departments is the new mantra to sustain a healthy growth in times of slowdown. The State Gross Domestic Product (GSDP) grew at 15% for the financial year 2018-19, up from 14.2% in 2017-18. In fact, the growth story of Telangana since its formation in 2014 has been nothing short of a miracle. It has made rapid strides on all fronts and achieved balanced development through a mix of innovative welfare and development programmes and emerged as one of the fastest growing States in the country. Prior to bifurcation, the average annual growth of the GSDP was only 4.2% at constant prices but over the last five years, it has increased two-and-a-half times. The fact that the GSDP stood at Rs 8.65 lakh crore in 2018-19 amply demonstrates the economic robustness of the State after bifurcation.