NEWS FROM STATES

MP to float Rs.105 crore loan to fund development schemes

The Madhya Pradesh government is floating a 10 year loan of Rs.105 crore in order to finance its various development schemes.

The loan will bear interest at the rate of 10.50 per cent per annum. The interest will be paid half yearly from March 20, 2001 each year. Interest in respect of the loan will be subject to tax under the Income-Tax Act, 1961. The gross amount of interest will be paid after rounding off to the nearest rupee.

The state has also launched a macro-management plan, with a view to bring about convergence of different schemes being implemented for promotion of agriculture. Under this scheme one budget head has been created for 24 central schemes in agriculture, an official release said.

The state government is allowed to dovetail its own programme components with the plan and the money available for one scheme could be used for other schemes. 

MP to be developed as a logistic hub

The Madhya Pradesh government is planning to market the state as a logistic hub following the footsteps of the Andhra Pradesh government. Already, Kerala has chosen tourism and Gujarat has been promoting its port-based petrochemical industry in a bid to woo investors to their respective states.

The `logistic hub' theme will be included in the state's economic development policy. The state government, in association with Confederation of Indian Industry (CII) is holding a mega meet Logistics-2001 to interact with industry. The government has also changed the concept of industry policy to `economic development policy'.

Drought-hit MP bans fodder export

The Madhya Pradesh government has banned export of fodder in view of the severe drought conditions prevailing. Chief Minister Shri Digvijay Singh, who took the decision recently, has also ordered constitution of forest panel to ensure availability of fodder for live-stock.

The railway ministry has allowed free transportation of cattle feed and water in the drought hit districts. Madhya Pradesh has a stock of 6,543.15 tonne of fodder.

The incentive for preserving grass and fodder has been raised by Rs.10 per quintal and Rs.90 lakh has been sanctioned to Betul, Chhindwara, Hoshangabad, Harda, Jhabua, Khandwa, Sidhi, Guna and Satna districts.

Annual plan size for MP pegged at Rs.3,630 crore

The annual plan size of Madhya Pradesh has been approved at Rs.3,630 crore.

The Planning Commission has however, cautioned the state about its declining agriculture growth rate and the poor population indicators like infant mortality and high birth rate. Shri K.C. Pant, Deputy Chairman of the Commission appreciated the measures taken to decentralise administration and efforts at fiscal discipline by the state.

Shri Digvijay Singh, Chief Minister, Madhya Pradesh said the revenue collection from power has been raised by involving unemployed youth to stop power thefts. He added that to ensure quality of roads, awarding of contracts for road construction has been linked to maintenance for atleast three years.

He asked the Centre to consider an increase in coal royalty and allow taxation of services by the state governments on the central pattern to augment revenues.

Fresh taxes in MP budget

Madhya Pradesh finance minister, Shri Ajay Narayan Mushran presented the budget for 2001-02 on 20.02.2001 with a deficit of Rs.490.75 crore and proposals for fresh taxes to generate Rs.124 crore additional resources.

A new tax of Rs.10 for every connection would be imposed on cable operators and this was expected to yield a sum of Rs.5 crore. Effective steps are proposed to be taken during the year to increase government income and reduce its expenditure for curtailing the deficit. The state's GDP in 1994-95 was 4.96 per cent which was below that of developed states like Maharashtra (6.5 per cent), Tamil Nadu (8.47 per cent) and Karnataka (8.43 per cent).
 

$ 180m World Bank loan for Rajasthan

Rajasthan government is to get a loan of $180m for power sector reforms. The loan will be spent on schemes for strengthening the power sector by setting up capacitators and new sub-stations. 

Rs.3,000 crore Rajasthan plan to up power output

Rajasthan is likely to spend Rs.3,000 crore on power production in the next few years. Inaugurating eighth sub-station of 132 kv at Ranoli in Sikar district, power and industries minister, Shri Chandrabhan said the state government has chalked out a plan to boost power production.

Remarking that efforts were onto check power leakage, he said. "It would help to provide better services to the consumers". Referring to projects initiated by the state government, he said in three years a network of grid sub-stations would be laid. 226 grid sub-stations have been constructed in the state during the last two years including six sub-grid stations of 220 kv, 15 of 132 kv and 205 grid sub-stations of 33 kv. Construction work on three grid sub-stations of 400 kv is in progress. 

Rajasthan puts up three wind energy projects

The Rajasthan State Power Corporation Ltd. (RSPC) has put up three wind energy demonstration projects in the state with a view to attract private investment in harnessing huge potential of power generation from wind. The last of the three wind energy demonstration projects began working at Phalodi in Jodhpur district on March 9, says RSPC MD, Shri S. Pant.

The Phalodi project has eight wind electric generators of 350 kw each erected at a height of 60 meters. Around Rs.8.50 crore has been spent on the project so far with Rs.3.84 crore coming from the ministry of non-conventional energy sources. IREDA has given a soft loan of Rs.3.11 crore and Rs.1.05 crore in the form of supplier's credit.

Rajasthan to spend Rs.5,000 crore in three years on power generation

The Rajasthan government plans to invest Rs.5,000 crore in three years on improving and enhancing power generation. Dedicating the second demonstration wind power project of North India, Rajasthan Chief Minister, Shri Ashok Gehlot said the government was focusing on infrastructure development of industries and mobilisation of maximum employment opportunities.

Rs.8.43 crore wind power project has been set up by Rajasthan State Power Corporation Ltd. at Devgarh Village near Chittorgarh. The project consists of three wind electric generators of 750 kw each totalling a capacity of 2.25 mw.

The state government has initiated a super thermal power project in Suratgarh which would generate about 250 mw every year.

Rajasthan has been pioneer in the field of non-conventional energy generation. The wind power projects of two mw in Jaisalmer, 2.25 mw in Devgarh and 2.10 mw in Phalodi have already been installed.

Rajasthan govt. approves Rs.800 crore pvt. investment

The Rajasthan government has approved an investment of more than Rs.800 crore in the private sector for industrial development.

The largest investment of Rs.500 crore will come in an optic fibre cable manufacturing unit. The state government would provide about 2,00,000 sq. meters of land at a concenssional rate for the setting up of the unit at Reengas in Sikar district and will also provide for construction of an airstrip nearby. While the state government would have the ownership of the strip, it would be constructed and maintained by the private company.

In the social sector, the state government will seek private sector investment to complete the unfinished 150 bed trauma hospital project in Jaipur.

All Rajasthan panchayats to get Net access by 2003

Rajasthan state chief secretary, Shri Inderjeet Khanna has directed the officials to connect all the gram panchayat head-quarters with Internet by December, 2003. All the six tehsils of Sikar district are to be computerised and connected with Internet by December 2001.

This is being done with a view to provide all the basic information to the cultivator in regard to the Khatedari of his land at panchayat headquarters.

A Reformist budget for Himachal Pradesh 

A reform oriented budget for 2001-2002 was presented in the Himachal Pradesh Assembly by Chief Minister Shri Prem Kumar Dhumal.

Keeping in view the State's limited resource base he felt that reform initiatives must focus on expenditure compression. Shri Dhumal announced rationalisation of government size to bring about a vertical reduction of posts from top to bottom including a 15 per cent cut in All India Service in five years. 

The budget proposed a comprehensive rationalisation of the tax system and rates in the transport sector in the coming year to further simplify the taxation system, remove anomalies and increase compliance.

To boost the tourism sector the budget proposed a 10 year tax holiday for tourism related industries and abolish toll tax and entry tax. Shri Dhumal proposed an accelerated disinvestment of state government holdings in public sector undertakings and assets to reduce the quantum of borrowings, besides phasing out of budgetary support for subsidies in various areas of agriculture and allied services.

The state plans to involve private sector in every sphere of economic activity, including power, tourism and roads sectors. Rs.5,659 crore outlay for the plan was proposed compared to the Budget estimates of Rs.4,966 crore and revised estimates of Rs.5,237 crore in 2000-01. The budget estimate projects non-plan expenditure of Rs.3,951 crore in 2001-02 compared to Rs.3,247 crore budget estimates and revised estimates of Rs.3,435 crore in 2000-01.

Tax-free budget in Andhra

The Andhra Pradesh budget for 2001-02 presented in the State Assembly by state Finance Minister, Shri Y. Ramakrishander on 20.02.2001 envisages a deficit of Rs.147.64 crore. 

The tax-free budget projects a revenue deficit of Rs.3,887 crore and a fiscal deficit of Rs.8,897 crore amounting to 5.8 per cent of the state GDP. The net deficit would be Rs.22.99 crore over and above a negative opening balance of Rs.124 crore. Revenue receipts have been budgeted at Rs.22,406 crore and revenue expenditure at Rs.26,293 crore. Plan expenditure has been budgeted at Rs.10,326 crore. Tax receipts are estimated at Rs.11,743 crore and most of the amount (Rs.10,503 crore) is for paying salaries and pensions.

The non-tax income of Rs.1,461 crore would be just sufficient for non-plan O&M expenditure. While the central tax devolution would amount to Rs.4,417 crore, interest payments would come to Rs.5,067 crore. Central grants amounting to Rs.2,959 crore would be used up by the subsidy on rice, other welfare programmes and maintenance expenditure totalling Rs.2,606 crore. The state government, therefore, has to borrow Rs.8,429 crore to meet the plan outlay of Rs.8,991 crore. 

Tax-free Haryana budget for fiscal discipline

The Haryana budget for 2001-02 presented in the Assembly in Chandigarh on 12.03.2001 by finance minister, Shri Sampat Singh stressed upon the significance of fiscal reforms and fostering financial discipline to achieve higher growth. No new taxes have been proposed in the budget. A "Sinking Fund" to take care of the increasing debt burden is proposed to be set up.

The growth-oriented budget laid special focus on measures to boost investment in infrastructure industries and agriculture and to improve the quality of infrastructure in social sectors.

The budget projections indicate a deficit of Rs.54.93 crore in the current year's account with the next financial year to close with a cumulative deficit of Rs.288.79 crore.

The plan outlay is of Rs.2,150 crore, an increase of 18.46 percent over the revised plan outlay of Rs.1815 crore. Shri Singh said there has been reduction in deficit in year's account by Rs.29.44 crore, reduced level of borrowings by Rs.82.20 crore and improvement in tax-GDP (gross domestic product) ratio from 7.46 percent in 1999-2000 to 8.38 percent during the current year.

The minister announced setting up of the State Economic Renewal Fund next year to meet the requirement emanating out of the state's plan to restructure and rationalise the working of various government departments and public sector units in the state.

The state will put greater emphasis on growth of infrastructure development in power, irrigation, roads and transport sectors with an allocation of 54.6 per cent of the total plan outlay.

No major fresh taxes in J&K budget

The Jammu & Kashmir budget for the year 2001-02, presented in the Assembly on 12.03.2001 by the State Finance Minister, Shri Abdul Rahim Rather has not proposed any major fresh taxes despite an overall estimated deficit of Rs.618.73 crore. Stress has rather been laid on corrective measures in realisation of existing taxes and duties.

During the current fiscal such measures have helped in realisation of an additional Rs.100 crore. These measures have also helped in reducing the current year's estimated deficit of Rs.2,032 crore to Rs.124.84 crore.

Trade and Industry has been provided some concessions which would result in larger turnover and realisation of more sales tax. Among the proposed concessions, sales tax on ornaments has been reduced from four percent to one percent, for tyres/tubes and motor spare parts from 12 percent to eight percent and tax exemption on service component of the small scale industries. 

Maharashtra's revenue deficit pegged at Rs.6,224 crore

The Maharashtra government's revenue deficit has been pegged at Rs.6,224 crore mainly due to the over Rs.3,000 crore aid given to the Maharashtra State Electricity Board (MSEB) to survive from the Enron shock.

Presenting the budget with an uncovered deficit of Rs.750.43 crore, state finance minister, Shri Jayant Patil said the increase in revenue deficit was also due to projected loss of Rs.5,000 crore during the next five years mainly due to the drastic cut effected in the share of the divisable Central taxes from the present 6.126 to 4.632 percent. Additional resource mobilisation measures of Rs.550 crore were introduced while a loss of over Rs.10 crore on account of sops given to various sectors has been estimated. 

Shri Patil proposed to bring down the revenue deficit to Rs.2,991.02 crore at the end of 2001/-02 through a freeze on DA and bonus to state employees, besides a freeze in fresh recruitments, bring down ceiling on raising of bond issue by various state run corporations from Rs.6,000 crore plus to Rs.4,200 crore.

Efforts would be made to curtail the revenue outgo at Rs.36,625.29 crore during 01-02 compared to Rs.36,495 crore in the revised estimates for 2000-01.

Mr. Patil in a bid to provide a level playing field to the domestic automobile, engineering, liquor industry and dairy sector anounced lots of sops to them to tide over the post-QRs scenario. Tax on sales of bio-fertilizers, milking machines and specified Indian musicial instruments reduced to 4 percent from 8 percent. Tax on sale of electricity generated and sold by licencee such as Tata Power and BSES increased from 10 paise per unit to 15 paise per unit w.e.f. April 01, 2001. 4 percent tax on sale of SIM cards introduced. 

Rs.286 cr deficit budget for Karanataka

Karnataka Chief Minister, Shri S.M. Krishna has proposed additional taxes to raise around Rs.284 crore in the Rs.286 crore deficit Budget for 2001-02.

It is proposed to bring down the revenue deficit to zero and to stablise the fiscal deficit at about 3 percent of GSDP by 2004-05 for Karnataka.

4 percent sales tax was levied on computer software including programming and providing and leasing of computer software. An annual tax of Rs.2,500 is to be imposed on mobile phone, internet and e-commerce operators. 

10 unviable public sector enterprises will be closed down or privatised by March 2002 and a corpus of around Rs.200 crore would be provided for Voluntary Retirement Scheme (VRS). The post of Divisional Commissioner is to be abolished. Purchase of new vehicles will be deferred. A time limit fixed for files disposal at all levels while the department of institutional finance merged with the finance department. 

Rs.460 crore Goa plan approved

The Planning Commission on 17.04.2001 approved an annual plan size of Rs.460 crore for Goa for the fiscal year 2001-02. 

Applauding the state for maintaining around six percent growth rate and attaining the highest per capita income in the country, Deputy Chairman of the Planning Commission, Shri K.C. Pant said the state needed to evolve a comprehensive plan for sustainable development of tourism. The state should encourage software development parks and explore the potential of horticulture and floriculture, he remarked.

Delhi's per capita income 100% more than national average

The per capita income of Delhi in 1998-99 at constant prices (1993-94) at Rs.19,091 was 100 percent more than the national average of Rs.9,739, according to an analysis done by the Associated Chambers of Commerce and Industry of India (ASSOCHAM).

Delhi was followed by Maharashtra at Rs.16,217 which exceeded the average national per capita income by over 65 per cent and Punjab at Rs.14,457 an income exceeding the average by 48 percent.

However, Rajasthan witnessed a dip in the per capita state income from Rs.7,811 in 1997-98 at constant prices to Rs.7,694 in 1998-99 recording a fall of 1.5 percent. The other state which came among the first 10 was Gujarat at 13,286 in 1997-98 and Rs.13,709 in 1998-99.

Rs.1000 cr revival package for Gujarat industries

The Gujarat government has unveiled Rs.1,000 crore comprehensive package for the rehabilitation of industrial units damaged during the earthquake.

Industry minister Shri Suresh Mehta said as per a detailed survey around 3,276 small and medium units suffered damages worth Rs.310.44 crore.

Units in Kutch district alone suffered a loss of Rs.190.26 crore, Rajkot Rs.42.98 crore, Jamnagar Rs.39.22 crore and Surendranagar Rs.12.81 crore.

As per preliminary estimates, industries suffered about Rs.2100 crore production loss. The state government was committed to revive the economy in the affected areas by rendering all possible assistance for restarting small, medium and cottage industries, which in turn would generate employment and restore money circulation. 

The package has been divided under three heads; industrial sector, trade, commerce and service sectors and cottage industry. Under the package for industrial sector, the state government would extend assistance to damaged small, medium and big industrial units falling in the earthquake zone 4 and 5.

For the repair of damaged building as well as plant and machinery, a capital investment support subject to a maximum limit of Rs.60 lakh or 60 percent, whichever is lower would be given.

To enable the units to restart normal commercial operations a working capital loan, subject to the maximum limit of Rs.20 lakh for two years (Rs.10 lakh each year) would be extended. No interest would be charged on these loans during the first two years. During the next one year, power/ electricity charges would be recovered on the basis of actual consumption and would not be subject to the clause of minimum electricity bill irrespective of use. 

A detailed survey has been initiated to assess the damage suffered due to collapse in trade, commerce and service sectors. The government has prepared a short-term plan for self-employed artisans and other labourers wherein 100 percent aid for purchasing tool kits costing upto Rs.2,500 would be provided to 10,000 self-employed artisans. 

Artisans engaged in hand-weaving, an aid upto Rs.10,000 would be given. In the handicrafts sector, the government would provide 100 percent loan for purchase of new tools costing upto Rs.10,000. If the cost of new tools is between Rs.10,000 and Rs.20,000, the maximum assistance would be 75 percent. In the case of new tools costing between Rs.20,000 and Rs.40,000, they can avail a maximum aid of 60 percent of the cost. The artisans desiring to set up temporary worksheds till they shift to a permanent shed would be provided an aid upto Rs.5,000.

The artisans whose houses and worksheds have been destroyed would be entitled to receive 100 percent assistance for setting up permanent worksheds of 20 to 25 square metre each. 

UP signs Rs.15,000 cr gas pipeline project pact

A Memorandum of Understanding (MoU) for a Rs.15,000 crore gas pipeline project in Uttar Pradesh was signed in New Delhi on March 04, 2001. 

The project to be completed in four years, will provide natural gas for fertiliser and power plants in the state and adjoining areas in New Delhi, Uttar Pradesh Chief Minister Shri Rajnath Singh said after the MOU was signed between Uttar Pradesh State Industrial Development Corporation (UPSIDC) and a US firm Unocal. This would facilitate purchase of natural gas on a long term basis by public and private sector units and support facilitation of permits, approvals and clearances of land acquisition. 

The project would also generate employment as it would lead to setting up of fertiliser and power projects in the State.

Chhatisgarh to set up 2 new power stations

The Chhatisgarh government is going to set up two thermal power stations of 500 mw capacity at Korba. It also plans to upgrade its existing two thermal power stations. It has earmarked an amount of Rs.375 crore to upgrade the thermal power stations and setting up of power sub-stations etc.