Bihar budget to raise outlay 16%

Bihar budget to raise outlay 16%
To totally eliminate revenue deficit by 2008-09
Press Trust Of India / Kolkata/ Patna March 03, 2006

Laying stress on strengthening law and order, infrastructure and developing social sector, Bihar's NDA government's maiden budget has proposed a 16.11 per cent hike in the total outlay and leaving an uncovered deficit of Rs 22.05 crore.

Presenting the full budget for 2006-07 in the State Assembly, deputy chief minister Sushil Kumar Modi, who also holds the finance portfolio, promised to totally eliminate revenue deficit by 2008-09 and cut down fiscal deficit to three per cent of gross state domestic product by that time.

Enumerating the new schemes launched by the government in keeping with its commitment to enhance rural employment and strengthen rural infrastructure, he said Rs 125 crore has been allocated for the "Mukhya Mantri Gramin Sadak Yojana" to connect villages having population between 500 and 1,000 with all-weather roads.

A sum of Rs 120 crore has been earmarked for the employment guarantee scheme launched in 15 of the state's 38 districts through government's own resources. These districts are not covered by the centre-sponsored National Rural Employment Guarantee Programme.

Modi promised to place an Outcome Budget detailing the physical assets proposed to be created by the government during the next financial year in the third week of this month before the budget is passed.

The budget pegged the total outlay at Rs 29,220.64 crore for 2006-07, up 16.11 per cent from Rs 25,167.04 crore in the current financial year.

Underlining improved law and order as crucial for attracting investment, Modi said Rs 133 crore would be spent on modernisation of the police force, which would be strengthened through recruitment of 2,500 sub-inspectors and 10,000 constables. A sum of Rs 5 crore has been set aside for modernisation of prisons.

To improve healthcare facilities, Rs 1,240 crore has been allocated for the health sector, including Rs 326 crores under plan and Rs 914 crore under non-plan heads, Modi said.

While Rs 281 crore would be spent on medicines and repair of hospitals, Rs 78 crore would be invested in construction of new hospitals. Private participation would be encouraged in pathology, radiology, maintenance and upkeep of hospitals, ambulance services and mobile medical units.

Stating that Bihar's economy was based on agriculture, Modi said to boost farm output; the government has earmarked Rs 1,212 crore for irrigation, Rs 316 crore more than 2005-06, a raise of 37 per cent.

A sum of Rs 20 crore has been set aside for minority welfare under which boundaries will be constructed at graveyards, construction of hostels for students of minority communities, and towards share capital of national minorities' development and finance corporation and state minorities financial corporation.

With a view to giving a fresh thrust to industrialisation a state investment promotion council has been constituted and Rs 205.33 crore set aside for "land bank scheme" under which land would be acquired in advance to be sold to prospective investors, Modi said.

He said to promote industrial investment. A new sugar policy has been announced under which purchase tax was abolished on procurement of sugarcane by mill owners.

To boost private participation in higher education, the government announced 50 per cent exemption on stamp duty for registration of land by parties interested in opening engineering and medical colleges. The government also exempted multiplexes from entertainment tax to encourage entertainment industry.

Rs 500 crore was earmarked for integrated development of Patna and Bodh Gaya under Jawaharlal Nehru National Urban Renewal Mission, while Rs 40 crore each was set aside for setting up a national law college and extension centre of Birla Institute of Technology in the state capital.

In order to strengthen infrastructure, allocation for the road sector was increased by 70 per cent from Rs 925 crore in 2005-06 to Rs 1562 crore in 2006-07. For electricity, a crucial factor in industrialisation, the allocation has been raised from Rs 477 crore this year to Rs 753 crore. Besides, Rs 412 crore has been earmarked to bridge the resource gap of Bihar state electricity board.

To strengthen the social sector, Rs 4886 crore has been provided for primary, secondary and higher education which includes state's share of Rs 384 crore under "Sarva Shiksha Abhiyan", Rs 165 crore for mid-day meal scheme and Rs 75 crore for payment of honourarium to "Shiksha Mitras", Modi said.

Modi said the projected revenue receipts for 2006-07 were pegged at Rs 28,944.64 crore against Rs 24,470.62 crore in 2005-06, up by 18 per cent.

The deficits in the consolidated fund and public accounts in the next fiscal were estimated at Rs 275.99 crore and Rs 375 crore respectively, he said, adding the revenue deficit of Rs 650.99 crore will be bridged to a great extent through the cast balance of Rs 628 crore available with the government due to short-spending in 2005-06 leaving an uncovered deficit of Rs 22.5 crore. The uncovered deficit will be bridged through mobilisation of internal resources, he said.