Rs 64,669 crore State Budget Unveiled

Srinagar: Unveiling Rs 64,669-crore budget for 2016-17, the Jammu and Kashmir government on Monday announced a slew of measures for women, including a fee waiver for girls in government schools.

A number of things, including mobiles, garments and packed food would turn costlier.
Jammu and Kashmir Finance Minister Haseeb Drabu also announced for women four police stations across the state and a dedicated city bus service in Srinagar and Jammu, while reserving 10 per cent area in industrial estates for their enterprises.
On taxation front, he proposed to hike VAT by 1 per cent on items, including cell phones, tablets and iPads, imitation jewellery, readymade garments, hosiery goods, packed frozen food, juices and ready-to-serve food.
Besides, all online purchases would be subjected to an entry tax, as against an earlier threshold limit of Rs 5,000, while an entertainment duty of Rs 50 per connection will be levied a month on satellite and cable TV operators.
The aviation turbine fuel levy will go up from 20 to 25 per cent, while the toll levied on vehicles will also go up.
At the same time, Drabu proposed to exempt from VAT the lodging services provided by hotels and guest houses, as also for carpets and agriculture produce.
The budget estimates envisage a deficit of nearly Rs 3,000 crore as the revenue receipts are expected to be to the tune of Rs 61,681 crore during the current fiscal.
“This fiscal the total receipts are estimated at Rs 61,681 crore. Of these 51,460 crore are revenues and Rs 10,221 crore in the form of borrowings. The state’s own revenues are estimated to be Rs 23,737 crore while Rs 9,500 crore will come from the state’s share in central taxes.
“In addition to this Rs 27,721 crore are to flow as other central transfers,” Drabu said in his budget speech.
The budget presentation, which was earlier scheduled to be held on January 18, had to be deferred in the wake of death of the then Chief Minister Mufti Mohammad Sayeed on January 7.
Giving details of the budget estimates, Drabu said Rs 19,694 crore will be the capital expenditure while Rs 44,975 crore will be the revenue expenditure.
“What these large numbers mean is that we are spending Rs 2.50 in order to be able to spend Re 1 on development. To reduce this ratio from 2.5:1 and at least bring it at par with the development spend is the first big challenge.
“We have made a good beginning in this budget. But the road ahead is difficult as salaries and pensions… account for more than Rs 23,000 crore which is more than the development expenditure in the year,” he added.
Drabu said the state had got a large development expenditure this year in view of the Rs 6,000 crore from the Rs 80,000 crore the Prime Minister’s Development Plan announced last year.
The highlight of budget was the women-specific measures which include waiving fees for all girl children studying in government-run schools up to 12th standard.
“In deference to our first woman Chief Minister (Mehbooba Mufti), I am introducing some gender specific budgeting initiatives. I propose the government waive… the fee of all girl students in the state government run educational institutions up to the higher secondary level,” Drabu said.
He also proposed that 10 per cent area in all industrial estates of the state will be reserved for women entrepreneurs, subject to the condition that if it is transferred, it shall be to an enterprise which is incorporated in the name of a woman and has women as the majority shareholders.
“I am proposing to set up two Entrepreneur Development Centre to be set up at Srinagar and Jammu to help, guide and train aspiring women entrepreneurs,” he said.
Drabu also announced setting up of four new women police stations at Pulwama, Kupwara, Kathua and Udhampur.
The budget also has provision of Rs 5 crore for starting a dedicated city bus service for women in Srinagar and Jammu.
“I am making a provision to provide exclusive women toilets in all state, district and sub-district hospitals,” he added.
The finance minister announced hike in certain taxes, including a 1 per cent increase in levy on all items which were earlier charged at 13.5 per cent under the VAT regime.
The list of items falling in this list has also been expanded to include cell phones, tablets, I-pads and accessories, imitation jewellery, readymade garments and hosiery goods. It also would include all types of packed, frozen food, juices and ready to serve food.
The aviation turbine fuel levy has been hiked from 20 to 25 per cent, while the toll levied on vehicles has been increased between 8 and 15 per cent.
An entertainment duty of Rs 50 per connection per month has been levied on satellite and cable TV operators.
All online purchases made in the state will now be levied entry tax as the budget proposes to do away with the earlier threshold limit of Rs 5,000.
“The online purchases by the consumers are increasing day by day and the practice to purchase goods and services by splitting the value into bills of less than Rs 5,000 is rampant. This puts local retailers to disadvantage as the same goods and services sold by them are costlier being loaded with tax,” Drabu said.
The budget proposes to extend the exemption on essential commodities, remission to local industry from payment of VAT, exemption on CST to industrial units, exemption from toll on raw material and finished products of industrial units and exemption to lodging services provided by hotels, lodges and guest houses.
Drabu also included carpet and agriculture produce under the exemption category. All types of cotton and yarn, handmade and handloom carpets were placed in the zero tax category.VAT will not be levied on agricultural implements like thrashers, tillers and harvesters while tax exemption is proposed to be extended on Rodenticides and herbicides.
The automobiles sold at CSD canteens to the members of the Armed Forces have been placed in the 5 per cent rate of tax instead of earlier 13.5 per cent
The VAT on parts of bicycles, tricycles, tyres and tubes of cycle rickshaws has also been put in 5 per cent category. 

Free 30 units power to BPL consumers
Waiving off the fixed charges in favor of all metered BPL domestic consumers, government from January 1, 2017 will provide upto 30 units of free power to the BPL consumers.
To consolidate the list, Dr Drabu said that government will “consolidate, verify and authenticate the Aadhaar linked list of BPL consumers in the state.

Rs 2,000 Cr scheme for PoK refugees sent to Centre
SRINAGAR: Jammu and Kashmir government has submitted a Rs 2,000 crore-scheme for rehabilitation of displaced persons of Pakistan-controlled Kashmir and Chamb to the Centre.
“For the displaced persons of PoK and Chamb, necessary scheme has been drawn up by the state government and submitted to the central government for approval and release of financial assistance of Rs 2,000 crore for its onward distribution among the identified 36,348 families,” state Finance Minister Haseeb Drabu said in his budget speech in the Legislative Assembly.
He said the cash assistance to migrants of Jammu province has been also recently enhanced and brought at par with Kashmiri migrants with effect from November 18 last year.

Welfare fund for journalists
Srinagar: Jammu and Kashmir government today proposed to set up a journalist welfare fund with an initial corpus of Rs two crore for providing financial help to working and accredited scribes in the state.
The legal heirs or dependents of working journalist will be provided assistance from the fund in case of death or incapacitation of the scribe concerned, state Finance Minister Haseeb Drabu said in his budget speech in Legislative Assembly.
“I propose to set up a Journalist Welfare Fund with an initial corpus money of Rs 2 crore for the welfare of working and accredited journalists of the state,” he said.
“For last 26 years, journalists working in strife-torn state of Jammu and Kashmir are facing hardship as there is no welfare scheme for scribes,” Drabu said.
“It would be ideal if the journalists of the state get together and set up a society, frame the rules and guidelines for administering this fund,” he said.

Budgetary provision for SRC doubled
To increase support for families affected by militancy, government has doubled the budgetary provision for the State Rehabilitation Council (SRC). This was stated by finance minister Dr Haseeb Drabu.
This he said will enable to increased support to affected families.

Sgr, Jmu to have standard food testing Lab
Lacking standard food testing laboratory or a drug testing laboratory, Jammu and Srinagar each is going to have a laboratory.
This was stated by finance minister Dr Haseeb Drabu in his budget speech.
Drabu said that he has initially earmarked provision of Rs 12 crore to have the mobile facility in the interior parts of the state.

Drabu ‘concerned’ about J&K Bank
Being promoter of state’s only listed company, State Government is concerned about Jammu and Kashmir Bank, this was stated by Finance Minister, Dr Haseeb A Drabu on Monday.
Speaking to media on the side lines of a press conference he addressed after presenting second budget, Dr Drabu said, “as promoters of J&K Bank, we are concerned.”
He was responding to questions over Non Performing Assets (NPA) of the J&K Bank. “There is concern… It will be communicated to the board.”
“I believe in corporate governance,” he said, “so there is a set up in J&K Bank. There is a proper Board of Directors (BoD) which is answerable.”
Under Companies Act, the FinMin said, they are liable. “We don’t want to encroach (its – BoD – space); that is how institutions die,” he asserted.

50% subsidy on scooties for college girls
Jammu and Kashmir Government announced a special soap for the college going girl students “to make them independent”.
Addressing a presser here at Banquet hall, J&K FinMin Economist Dr Haseeb A Drabu said that keeping in view that J&K has woman chief minister for the first time in its history, the government has taken many women specific initiatives. “College going girl students will be given 50% subsidy on purchase of a Scooty,” he said. “The idea is to make them independent in mobility.”
Dr Drabu, during his second budget as J&K FinMin, said also announced Rs 500 Crore for special buses exclusively for women folk of Jammu and Kashmir.
Explaining the measures and initiatives his government is taking to eradicate the unemployment from J&K, Dr Drabu said, “we have tried to boost and invest in areas having potential of generating employment.”
He said that it was after ten years that his government announced new industrial estates and Rs 10 crore have been allocated to each new such estate.“We have focused on IT sector and entrepreneurship,” he said, “we have identified top ten IT firms with whom we will go for joint ventures.”
Further, he said, “it is for the first time that any government in J&K has allocated funds for police department.” “I kept Rs one lakh each for 193 Police Station for cost of investigations,” he said, “the idea is that people from no onwards will not be paying for fuel and other charges during investigation by police.”
Observing that the issue of 61000 casual and contractual employees is a social issue, Dr Drabu said, “this budget has tried to accommodate their concerns. It is an issue of 61k families not of finances only.”
Deciphering the financial position and planning in distribution of money in various developmental initiatives, Dr Drabu said, “we tried to do frame this budget on normative basis. Since funds there was inequality in funds distribution for same work, we tried to fulfil that gap.”
Casting an example, he said, “what governments have been doing is allotting Rs 10 Cr for sub-district hospital in one area and Rs 60 Cr for similar type of hospital in another area which is technically wrong and we have tried not to do that.”
When asked whether J&K Government was dependent on Union Government funds, he said “technically not.”
“J&K has its own resources but then there are modalities through which states get share from Union resources which is their right,” he said, “there is Finance Commission which works on the basis of Constitution of India and allots money to states because the resource which belongs to Union Government originally belongs to a particular place, therefore, the revenue thus generated from them is to be shared between Union and state.” “Then there is planning Commission which also gives funds.”
“Operationally,” he said, “we are supposed to get fund which doesn’t mean that we are dependent.”
Seconding FinMin, Commissioner Secretary to J&K Government, Navin Choudhary said, “it is because state governments fail to utilise the share of funds in a time bound manner that they such things crop.”
He also revealed that J&K state has got two over and above plan and non-plan fund allocation from Union Government since 1947. “First it was 2003 when Prime Minister’s Reconstruction Fund was announced and I was Advisor to J&K Government then and in 2015 Rs 80000 Cr package was announced by PM.”
“These packages don’t come through any window that doesn’t mean it is dependence,” he said, “so, lot of finances come from Union government.
Maintaining that his government “supported flood affected business men to a lot extent”, he said, “we gave interest subvention. Relief was released and more money is coming.” He also revealed that under PM’s Rs 80k Cr package, J&K Government shall be using Rs 6000 crore this fiscal.

Rs 1 lakh for Police Stations
Police stations in Jammu and Kashmir will now get Rs one lakh each to cover expenses of investigating cases.            
“I propose to allocate Rs One lakh each in favour of all the 193 police stations of the state as ‘cost of investigation’. Having the legitimate financial resource will certainly uplift the image of police stations in the minds of common masses,” state’s Finance Minister Haseeb Drabu said in his budget speech in the state assembly here today.            
Drabu said the police stations had never been provided any specific financial resources to meet routine expenditure for investigating crimes. “Even as we speak, no police station, the primary interface with the citizens for resolution of law-and-order issues, has ever been provided any specific financial resources to meet the routine expenditure such as the cost of investigation of the crimes. This includes basic things like petrol or stationary,” he said.
He said the CAG had pointed out that from 2009-10 to 2013-14, allotment of fuel to district police stations for running their police vehicles was virtually non-existent. “Such is the inefficiency of the system, that one-third of the fuel quota was being consumed in to and fro journeys by vehicles from police stations to petrol pumps located at the district headquarters.        
“With this kind of a setup, the SHO has nowhere but to look for manna from heaven. This has often resulted in the perception of police station and its personnel being corrupt,” he said. Drabu said budgetary announcements in the past had sometimes led to inappropriate, unethical behaviour and petty corruption.      
“It may not be inappropriate to say that at times unethical behaviour and petty corruption has been a consequence, undoubtedly an unintended one, of budgetary announcements,” he said. Citing an example of austerity drive of few years ago, Drabu said the big cut that Finance Department enforced was on tea served in offices.        
“The tea never actually stopped but its financing changed. The tea that Hon’ble Ministers and officers had was paid, if whispers in the secretariat are to be believed, from faking printer cartridge bills. This to me sanctifies unethical behaviour and breeds corruption at the lowest level and the system not only condones it but also internalizes it as acceptable behavior,” he added.

Rs 49.78 Cr for settlement of Houseboat owners
To have one-time settlement with J&K Bank and the State Bank of India vis-a-vis debt waiver scheme for houseboat owners, Dr Haseeb Drabu earmarks Rs 49.78 crore for the total outstanding balance.
Dr Drabu said that the money for the scheme was released in 2004 but was “diverted for other expenditures by the state government.”
This he says “give a major financial and emotional relief to all the houseboat owners and taxi drivers who have become defaulters with the banks.”


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