Politics

Corona dents exchequer; Telangana mulls sale of bonds

Hyderabad: Night curfew and Coronavirus second wave have taken a toll on the state government's finances in April. While last Financial Year (2020-21) started with total state-wide lockdown in April 2021, the present Financial Year (2021-22) has begun with state-wide night curfew from April 20.

This apart, the rapid spike in coronavirus cases halted financial transactions as people remain confined to their homes for fear of contracting the virus.
Added to this, the voluntary closure of shops and establishments at several places in all districts even during the day to contain the virus compounded the financial woes of the state government.

According to official sources, "The state’s average income per month from all sources, including Centre's tax devolution is around Rs 12,500 crore. Of this, Rs 6,000 crore go towards establishment expenditure which include salaries and pensions for staff. Of this, around Rs 2,000 crore used for clearing debts and payment of interest and principal amount."

However, the state government earned only Rs 7,000 crore this month. To fill this gap to some extent, the government has raised Rs 3,000 crore from RBI by auctioning state development bonds in April, they added.

The finance department seems to be worried about meeting the huge budgetary target of Rs 2.30 lakh crore set for this fiscal 2021-22 if night curfews are extended or partial lockdowns, or weekend lockdowns are imposed in the coming days. This is cited as the main reason for the state government not keen on imposing further lockdowns in the state though various other states are opting for it.

It may be noted that the government could meet only just about Rs 1.50 lakh crore against budgetary target of Rs 1.72 lakh crore last fiscal due to corona outbreak and subsequent lockdowns. Instead of lowering the budget target in this fiscal due to the corona pandemic, the government preferred to increase it to a staggering Rs 2.30 lakh crore.

Earnings through commercial taxes, GST, sale of liquor, petrol, diesel, stamps and registrations are the main revenue sources for the state government. Due to corona conditions and night curfew, these collections have come down. To fill this revenue gap, the government has decided to raise Rs 47,500 crore this fiscal through auction of bonds.

The government is also planning to raise Rs 30,000 crore through sale of lands but it looks difficult, given the slowdown in economy on account of corona pandemic.

Source:

www.deccanchronicle.com

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