Odisha Budget pegs higher fiscal deficit, targets Rs 7,324-cr market borrowing

Odisha’s Budget for 2016-17 has pegged fiscal deficit at Rs 14,533 crore or 3.79 per cent of its gross state domestic product, which is higher than the mandated threshold of 3.5 per cent, indicating the state’s growing appetite for funding capital-intensive projects through debt.

Total Budget outgo was pegged at Rs 94,053 crore, inclusive of a total annual Plan outlay of Rs 50,000 crore with focus on agriculture, health, social sector and rural infrastructure. The projected fiscal deficit exceeds the 2016-17 figure at Rs 9,932 crore by 31 per cent.

The state government pegged its gross borrowing at Rs 15,014 crore, which includes the net market borrowing of Rs 7,324 crore. Overall debt stock for 2016-17 has been estimated at Rs 64,992 crore, 17 per cent of GSDP (Rs 3.83 lakh crore) and within the limit of 25 per cent prescribed by Odisha Fiscal Responsibility and Budget Management Act, 2005.

Odisha finance minister Pradip Amat said the fiscal deficit of 3.79 per cent was arrived at after factoring in the impact of Ujjwal Discom Assurance Yojana (UDAY).

"If the impact (of UDAY) is taken out, the deficit comes down to Rs 13,336 crore, which is 3.48 per cent of GSDP against the proposed FRBM limit of 3.5 per cent," he said.

The Budget projects a revenue surplus of Rs 3,683 crore after factoring in revenue expenditure of Rs 74,443 crore for the next financial year.

Separately, the state presented an exclusive Budget for the agriculture sector for the fourth year on a trot. The farm Budget has pegged the outlay at Rs 13,182 crore, announcing a start-up fund for promotion of entrepreneurship in agri-business, agro-based industries and enterprises. In the agri Budget, the state also announced an interest subvention of Rs 228 crore to be provided to drought-hit farmers over three years.

Capital outlay has been proposed to be enhanced to Rs 16,750 crore, or 4.37 per cent of the GSDP. Total revenue receipts have been projected at Rs 78,127 crore.

Continuing its endeavour towards 'ease of doing business', the state government has set aside Rs 22 crore for incentives under Industrial Policy Resolution and Rs 10 crore for development of industrial infrastructure.

The Budget has proposed an outlay of Rs 260 crore for equity contribution towards new railway projects through special purpose vehicles.

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