State pins hope on Finance Commission for bailout
Seeks Rs 8,775 cr for farm sector; Rs 24,813 crore as debt relief grant
Ruchika M. Khanna
Tribune News Service
Chandigarh, September 7
Chief Minister Parkash Singh Badal has demanded Rs 8,775 crore for the farm sector, besides a debt relief grant to the tune of Rs 24,813 crore for the state from the 14th Finance Commission,.
Making a forceful presentation, after submission of a memorandum, before the Finance Commission led by its Chairman YV Reddy at the Punjab Bhawan this morning, the Chief Minister informed the commission that the Centre had referred the issue of debt-stressed states of Kerala, Punjab and West Bengal to the 14th Finance Commission and thus demanded Rs 24,813 crore as debt relief grant towards outstanding small savings and Central Government loans.
He mentioned that the then Prime Minister IK Gujral had waived the entire special term loan raised during the militancy period in Punjab. However, when it came to implementation, only the outstanding balance on that date was waived. He impressed upon the commission to grant a special term loan and interest already paid by the state amounting to Rs 2,694 crore at current prices.
The Chief Minister also requested the commission to fix the share of states in central taxes at 50 per cent and also to bring cess, surcharge and royalties to the shareable pool.
Seeking a package of Rs 8,775 crore, the Chief Minister said the state needed the money for a shift in the cropping pattern (Rs 2,400 crore), upgrading grain storage and handling (Rs 2,750 crore), development of livestock sector (Rs 1,880 crore), water management (Rs 550 crore), market development (Rs 585 crore) and research and development (Rs 350 crore), besides other things.
The state said the government did not have requisite funds to achieve diversification in agriculture, and the money the state got under the Rashtriya Krishi Vikas Yojana was too less to achieve this objective.
Punjab has also asked the Finance Commission to set up a dedicated agriculture diversification fund for states that were instrumental in ushering in the Green Revolution and devolution of this fund should be based on performance benchmarking.
Since devolution of funds for agriculture through a common pool or plan allocation have failed to bring farmers out of the wheat-paddy cycle, Punjab has urged upon the Finance Commission to make a sustainable arrangement for funding of agriculture diversification that increases the size of the agricultural economy and avoids a situation where the country's food security and livelihood of farmers are threatened.
Earlier, Finance Minister Parminder Singh Dhindsa said the government had enacted Fiscal Responsibility and Budget Management Act in 2003 and subsequently amended it to make it consistent with the fiscal consolidation path recommended by the 13th Finance Commission. The state has been able to meet the financial consolidation path targets except for revenue deficit. Punjab’s wishlist
Fix the share of states in central taxes at 50 per cent
Bring cess, surcharge and royalties to the common pool
Set up a dedicated agriculture diversification fund for states instrumental in ushering in the Green Revolution
Seeks Rs 8,775 cr for farm sector; Rs 24,813 crore as debt relief grant
Ruchika M. Khanna
Tribune News Service
Chandigarh, September 7
Chief Minister Parkash Singh Badal has demanded Rs 8,775 crore for the farm sector, besides a debt relief grant to the tune of Rs 24,813 crore for the state from the 14th Finance Commission,.
Making a forceful presentation, after submission of a memorandum, before the Finance Commission led by its Chairman YV Reddy at the Punjab Bhawan this morning, the Chief Minister informed the commission that the Centre had referred the issue of debt-stressed states of Kerala, Punjab and West Bengal to the 14th Finance Commission and thus demanded Rs 24,813 crore as debt relief grant towards outstanding small savings and Central Government loans.
He mentioned that the then Prime Minister IK Gujral had waived the entire special term loan raised during the militancy period in Punjab. However, when it came to implementation, only the outstanding balance on that date was waived. He impressed upon the commission to grant a special term loan and interest already paid by the state amounting to Rs 2,694 crore at current prices.
The Chief Minister also requested the commission to fix the share of states in central taxes at 50 per cent and also to bring cess, surcharge and royalties to the shareable pool.
Seeking a package of Rs 8,775 crore, the Chief Minister said the state needed the money for a shift in the cropping pattern (Rs 2,400 crore), upgrading grain storage and handling (Rs 2,750 crore), development of livestock sector (Rs 1,880 crore), water management (Rs 550 crore), market development (Rs 585 crore) and research and development (Rs 350 crore), besides other things.
The state said the government did not have requisite funds to achieve diversification in agriculture, and the money the state got under the Rashtriya Krishi Vikas Yojana was too less to achieve this objective.
Punjab has also asked the Finance Commission to set up a dedicated agriculture diversification fund for states that were instrumental in ushering in the Green Revolution and devolution of this fund should be based on performance benchmarking.
Since devolution of funds for agriculture through a common pool or plan allocation have failed to bring farmers out of the wheat-paddy cycle, Punjab has urged upon the Finance Commission to make a sustainable arrangement for funding of agriculture diversification that increases the size of the agricultural economy and avoids a situation where the country's food security and livelihood of farmers are threatened.
Earlier, Finance Minister Parminder Singh Dhindsa said the government had enacted Fiscal Responsibility and Budget Management Act in 2003 and subsequently amended it to make it consistent with the fiscal consolidation path recommended by the 13th Finance Commission. The state has been able to meet the financial consolidation path targets except for revenue deficit. Punjab’s wishlist
Fix the share of states in central taxes at 50 per cent
Bring cess, surcharge and royalties to the common pool
Set up a dedicated agriculture diversification fund for states instrumental in ushering in the Green Revolution
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