(MENAFN- IANS) Mumbai, July 8 (IANS) Days after the presentation of the Rs 6,12,293 crore budget for 2024-25, the MahaYuti government in Maharashtra will present supplementary demands of Rs 94,000 crore plus during the ongoing Monsoon session, mainly to finance the implementation of a slew of freebies and sops in the run-up to the Assembly elections slated for September-October.
The state cabinet, chaired by Chief Minister Eknath Shinde, gave its approval after Finance Secretary Saurabh Vijay put up the Finance Department's proposal in this regard.
The supplementary demands will be necessitated as the government will badly need money to allocate funds for populist schemes worth Rs 96,000 crore announced in the budget. These schemes will be financed after the state legislature passes the supplementary demands. Various schemes to be funded included Mukhamantri Ladki Bahin Yojana (Rs 46,000 crore), free higher education for girls (Rs 2,000 crore), Mukhyamantri Yuva Karyaprashikshan Yojana (Rs 10,000 crore), free electricity to farmers for agricultural pumps up to 7.5 horsepower capacity (Rs 14,761 crore) and few small and big schemes for various sections (Rs 20,000-25,000 crore).
The government's move to table supplementary demands comes when Deputy Chief Minister and Finance Minister Ajit Pawar has projected a revenue deficit of Rs 20,051 crore and a fiscal deficit of Rs 1.10 lakh crore in the budget for 2024-25. He has also estimated the state's public debt stock to increase to Rs 7.82 lakh crore in 2024-25 against Rs 7.11 lakh crore.
The revenue deficit is expected to be 0.47 per cent of the gross state domestic product (GSDP) while the fiscal deficit will be 2.59 per cent of the GSDP in 2024-25. Both are way below the 3 per cent limit of the GSDP as mandated by the Fiscal Responsibility and Budget Management Act (FRBM).
A senior minister said: "The government is making all efforts to adhere to the Finance Commission's recommendations and provisions of the FRBM Act. However, in the wake of supplementary demands of Rs 94,000 crore plus for the implementation of several schemes, the state's fiscal deficit is expected to cross the 3 per cent limit of the GSDP and it may surge to a record 4.87 per cent, which will be for the first time in the state. However, the government is capable of tackling the situation as it is bullish about its rapidly rising tax revenue."
However, another minister admitted that if the fiscal deficit crosses 3 per cent of the GSDP, then it may seriously impact the government's cash flow which will bring many constraints in borrowing money from the market. "The government will have to focus on fiscal management in such a situation to avoid fiscal distress ahead of the coming Assembly election. This will certainly be a major challenge," he asserted.
(Sanjay Jog can be contacted at ...)
MENAFN08072024000231011071ID1108418259
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.