Hyderabad: With an eye on elections scheduled to be held later this year, the Chief Minister K Chandrashekar Rao-led Telangana government set its focus on welfare schemes in the state budget, which saw a 13 per cent increase from last year’s allocation. Analysts have termed the budget a “populist’ one, with the government trying to “appease all sections”.
State Finance Minister Harish Rao on Monday presented the budget for the financial year 2023-2024, with an outlay (including public debt) of Rs 2.90 lakh crore, up from last year’s Rs 2.56 lakh crore. While the revenue expenditure was estimated to be Rs 2,11,685 crore, the capital expenditure was at Rs 37,525 crore.
A state’s budget is split between its revenue expenditure and capital expenditure (Capex). While revenue expenditure covers salaries, interest payments, and allocation for welfare schemes, capital expenditure is the money spent on infrastructure projects, education, health sector, agricultural projects.
While presenting the budget, Rao accused the central government of “creating hurdles” and blocking Telangana’s development. “Even while Telangana has been achieving significant development through its own efforts, the central government has been creating hurdles after hurdles,” Rao said, adding how the government resorted to off-budget borrowings well within the limits of FRBM (Fiscal Responsibility and Budget Management) Act to complete irrigation projects within the shortest time.
According to the FRBM Act, the fiscal deficit of a government should not exceed 3 per cent of its total GDP.
The finance minister also criticised the central government decision to reduce the state government’s borrowing limit. “During the current year, based on our economic performance and borrowing limits, an amount of Rs 53,970 crore has been included in the Budget as borrowings. This was approved by this August House. But the Central government unilaterally imposed a cut of Rs 15,033 crore and reduced our borrowing limits to Rs.38,937 crore,” he said.
The Gross State Domestic Product (GSDP) for the state increased 15.6 per cent from 2021-2022 to Rs 13.27 lakh crore for FY 2022-23.
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Schemes & allocations
In the latest state budget, schemes such as Kalyana Lakshmi/Shaadi Mubarak — where girls aged 18 and above, hailing from SC/ST and minority communities, receive one-time cash assistance for marriage — saw an increase of 16 per cent in the budget allocation (estimate). About Rs 3,210 crore was allotted in the 2023-2024 financial year, while Rs 2,750 crore was allotted in 2022-2023 year.
The budget (estimate) kept aside for agriculture and allied sectors for 2023-2024 saw a 10 per cent increase from the previous year, with an allocation of Rs 24,254 crore. The sector includes schemes such as CM’s brainchild Rythu Bandhu which gives cash assistance to farmers in two cropping seasons (Kharif and Rabi) and other welfare schemes such as Rythu Bhima (insurance to families of deceased farmers), farm loan waivers.
The budget for old age pensions (Aasara pensions), in 2023-2024, was at Rs 12,000 crore, an increase of 2.3 percent from 2022-2023.
The Scheduled Caste Special Development Fund (SCSDF) was allotted Rs 36,750 crore, an increase of 8 per cent from 2022-2023 when Rs 33, 937 crore was allotted.
Under this, a significant amount of Rs 17,770 crore has been assigned for KCR’s flagship welfare program named Dalit Bandhu which gives Rs 10 lakh cash assistance to eligible Dalit families across the state. The same amount was set aside in the 2022 financial year too. For the welfare of Scheduled Tribe Community, the government set aside Rs 15,233 crore, an increase of 20 per cent from last time.
The minority welfare department budget (estimate) saw a 25 per cent increase for the upcoming fiscal year compared to 2022-2023. The latest budget allotted Rs 2,200 crore for the same.
An amount of Rs 6,229 crore has been set aside for the welfare of Backward Community in 2023-2024, an increase compared to Rs 5,698 crore in 2022-financial year.
The state government set aside Rs 19,093 crore (estimate) for the education sector in 2023-2024. The allocation for the sector in the 2022-23 budget was Rs 19, 580 crore.
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Expert opinion
Krishna Reddy Chittedi, assistant professor at the School of Economics, University of Hyderabad, told ThePrint: “Almost every social sector category saw an increase in budget allocation. Very clearly this is the government completely trying to please all sections of state, appeasing all the sections, especially those which are a major vote bank. So, overall it is a populist and attractive budget. This also comes at a time when KCR wants to establish his party as a national party, he has been making efforts, so there is eye on state’s budget. Especially, on sectors where he made promises of welfare.”
Reddy pointed out how sectors such as education got a raw deal with no major difference in budget allocation, compared to previous years. Ever since the state formation, in 2014, Telangana’s budget share allotted to education has seen a decline.
“It appears that CM has some grudge on education sector. The focus has to be on increasing manpower in schools (teachers), their recruitment and training. Else, how else will the future generations benefit, how will they be ready for jobs without skill development training?” he said, adding that Telangana’s government schools suffer from acute teacher strength crunch.
“KCR has always been a pro-welfare person… This time too, he made sure welfare does not get any cuts, instead saw an increase. How much of it will continue post election, is the question. Given his governance, there won’t be much of a change though. A significant part of budget presentation time was also allotted to pointing out how state is managing even without Centre’s funds or the hurdles created by the Centre. They wanted to create that perception,” economic and political analyst D. Papa Rao told ThePrint.
(Edited by Anumeha Saxena)
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