Hyderabad: The Union budget has focused on growth with bulk of additional resources coming either from asset monetisation or borrowings, TRS MP J Santosh Kumar said in Rajya Sabha on Tuesday.
Stating that the focus of expenditure was on capital assets creation, he said that though fiscal deficit and debt are matters of concern, the overall policy measures appear to be in the right direction. “If all the policies announced are implemented earnestly, then there is hope that India will bounce back quickly from the havoc caused to the economy by Covid 19,” he said, speaking on the Appropriation Bills in the House.
“Our GDP growth steadily decreased from 8.1 per cent in the last quarter of 2017-18 to 3.1 per cent in last quarter of 2019 -2020. The Indian economy is expected to shrink further to minus 8.0 per cent during 2021. “But, the positive aspect is that we have been able to bounce back in the third quarter of 2020-21 and able to register a positive growth which is a good sign for the economy,” he said.
The only way the Central government can support additional expenditure on healthcare and other essential expenditures aimed at job creation such as MNREGA, free distribution of food grains, etc., was through borrowing an additional amount of Rs 10.52 lakh crore, Santosh Kumar said, adding that this had led to a historical high fiscal deficit of 9.5 per cent against the expected deficit of 6.8 per cent of GDP in 2020-21. To this extent, the Central government acted swiftly to avoid further damage to economy.
In tune with Covid demands, the budget marked an expenditure of Rs. 2.23 lakh crore in the coming year on health and well-being. This is 137 per cent increase from last year. Outlay on drinking water and sanitation of about Rs. 60,000 crore and Rs. 2700 crore for nutrition are a welcome feature, he said.
Stating that the outlay for armed forces had gone up by nearly 19 per cent at Rs 4.78 lakh crore, he said: “With our standoff with China, the government has kept its purse strings loose for defence expenditure despite pandemic hitting the economy hard.”
He said Rs 2.87 lakh crore was allocated for Jal Jeevan Mission, over six years to give piped and safe drinking water to 2.8 crore households. In Telangana, the State government has already had achieved more than 98 per cent target by mobilizing resources of the State and borrowing from financial institutions through flagship programme Mission Bhagiratha by spending Rs. 30,000 crore.
Under the leadership of Chief Minister K. Chandrasekhar Rao, Mission Bagiratha has become role model for the country and inspiration for Jal Jeeevan Mission. The tax devolution to States was heavily impacted as there was a drop in revenue receipts of the Union government. Secondly, performing States have been penalized by the 15th Finance Commission through its unacceptable methodology.
On Telangana State, he said there was a lot of expectation that the Central government would give a special package of Rs. 25,105 crore under various heads. It was expected that the Centre will compensate the State under Jal Jeeven Mission for completing Mission Bhagiratha.
Santosh Kumar requested release of grants amounting to Rs.1,350 crore (Rs.450 crore each for 2019-20, 2020-21 and 2021-22) under the package of the development of backward regions of the State as mandated under section 94(2) of the AP Reorganisation Act.
He urged the Centre to release dues amounting to Rs. 1,114 crore and Rs.817.61 crore of 13th and 14 th Finance Commission grants to local bodies. The 15th Finance Commission for its award period between 2021-26 has recommended grants amounting to Rs. 3,024 crore as sector specific grants and Rs. 2,350 crore as State-specific grants to Telangana.