Finance Commission holds meetings with TS Govt

Hyderabad: The Fifteenth Finance Commission today held meetings with the Chief Minister K. Chandrashekhar Rao, his Cabinet ministers and senior officers of the state administration.

There were detailed discussions on the State Finances, Mission Bhagiratha and the irrigation projects.

The Commission noted that the State Government has witnessed revenue surplus in 2015-16, 2016-17 & 2017-18 (Revised Estimates). The trend growth rate (TGR) of capital expenditure incurred by the State was 27% from 2015-16 to 2017-18(RE). In 2016-17, Telangana had highest own tax revenue (OTR) to GSDP of 7.34% amongst all 29 states as compared to average OTR of 6.27% of all States.

Except in the initial months, the State has not received any GST compensation. The growth rate of GST revenue for State of Telangana was 20% against 14.7% for Andhra Pradesh from April to December 2018 over the same period last year.

Telangana was ranked second in Ease of Doing Business (EoDB) Rankings, 2018 with a score of 98.28%, trailing by just 0.02 percentage points from Andhra Pradesh, which was ranked first.

A Legislation giving statutory status to the new industrial policy called the “Telangana State Industrial Project Approval and Self-Certification System” (TS-iPASS) was enacted. Under this legislation, a right to Single Window Clearance has been bestowed on all applicants. This is the first of its kind legislation in the entire country.

In the context of Rythu Bandhu scheme being implemented, the physical progress of Telangana compared to other States on various components of Digital India Land Records Modernization Programme (DILRMP)

The CAG Report has questioned the revenue surplus of the state. The State had, in fact, revenue deficit of Rs. 5,392 crore in 2016-17.

The fiscal deficit of the State rose sharply from 3.26% of GSDP in 2015-16 to 5.35% in 2016-17. Further, the fiscal deficit excluding amount transferred under UDAY scheme (Rs. 7,500 crore) was 4.22 per cent in 2016-17. The fiscal deficit has, however, come down to 3.12% in 2017-18(RE).

Debt to GSDP ratio of the State jumped by 3.5 percentage points from 16.96% in 2015-16 to 20.44% in 2016-17.

Four districts viz., Hyderabad, Ranga Reddy, Medchal-Malkajgiri and Sanga Reddy contribute 52 per cent of the GSDP & only these 4 districts have per capita income above the average of all 31 districts of State.

Amongst other matters, the State has urged the Commission for continuation of the facility of additional borrowings over and above the 3% of GSDP limit; Raising additional borrowing facility to 1 per cent of GSDP; Implementation of their own flagship programmes suitable to the state; Leaving introduction of welfare scheme to the States; Compensate the State suitably for the implementation of GST- inform of higher tax devolution; Increase tax devolution to 50 per cent of the divisible pool of Central taxes; Significantly increase grants to rural and urban local bodies; Recommend an amount of Rs.40,169 crore as maintenance grant for the State’s lift irrigation projects - during the award period of the 15th Commission and grant of Rs. 12,722 crore for the initial five years of the Mission Bhagiratha pitied drinking water project of the State.

The Commission was appreciative of the fact that Telangana would be the first Indian state to be able to provide drinking water to every household under Mission Bhagiratha.

The Commission promised to look into all the matters raised by the state government in their final recommendations to the Union Government.

Earlier, the Commission had held a detailed meeting with the representatives of all political parties. The Chairman appreciated the important issues raised by them and promised to look into each of them with the seriousness it deserved.