Just about seven months before the Commonwealth Games get underway, the Delhi government has suddenly woken up to the unpleasant fact that it is broke.
It needs a whopping Rs 1,000 crore to fund the numerous projects that it has been dangling before the citizens of Delhi in the name of Commonwealth Games for years and that the only way it can get that money is by dipping into your already stressed and lightened-by-the-Centre pockets.
The hiking of the Value Added Tax on diesel, CNG and a number of necessary items might make a dent in your income and savings, but look at the upshot: the exchequer will instantly become richer by as much as Rs 805 crore.
Fresh out of the shock of increased petrol and diesel prices in the Union Budget last month, the common man will again find his kitchen budget going topsy turvy thanks to the removal of the Rs 40 subsidy on LPG cylinders, but the government will be richer by another Rs 170-odd crore, thanks to this move.
Always the optimist, Chief Minister Sheila Dikshit thinks Delhiites can and are ready to afford the hike.
“The standard of living has increased, so we think that the people will be able to afford the hike,” Dikshit said after the Budget on Monday.
“There has been a lot of developmental work in the city and there’s lots more to happen. A lot more money is needed for that and the government has no option but to slightly burden the people to incur the losses,” she said.
While the government might have spent more than it could afford on the Games, it could have easily distributed the hike over three-four years thereby cushioning the shock for hapless Delhiites.
But then in the past three years Dikshit, a seasoned politician, had elections to win. Starting from the MCD elections in mid-2008, the Assembly elections in November that year and the General Elections in May, last year, the “political seasons” were not right for any kind of hike.
Now, with no more elections around the corner, the gloves are off.
“The subsidy for LPG was given in June 2008 when the inflation rate was very high. A lot has been spent in the wake of the Games,” she said.
The aggressive VAT structure also increased the Delhiites’ cost of living, as luxury items—from high-end mobiles to apparel to aerated drinks—will attract a heavier tax.
In Walia’s Rs 26,000-crore Budget outlay, transport and road infrastructure continued to be the thrust area receiving 38 per cent of the funds—up from last year’s 35. Urban Development and Water Supply/Sanitation got 13 per cent apiece—the second biggest chunks of the pie.
But the residents can’t complain. There’s still some silver lining that they can look forward to. “From next year onwards, we will concentrate more on the social sector,” Dikshit said.