Five focus areas in ₹427,780 cr Maharashtra budget
Mumbai: Maharashtra deputy chief minister and finance minister Ajit Pawar presented the ₹427,780 crore state budget for the financial year (FY) 2022-23 in the legislative assembly on Friday and said that the government has identified five focus areas — agriculture, health, human resources, transport, and industry — offering an estimated outlay of ₹1,15,215 crore in FY ’23 and ₹4 lakh crore over next three years
Mumbai: Maharashtra deputy chief minister and finance minister Ajit Pawar presented the ₹427,780 crore state budget for the financial year (FY) 2022-23 in the legislative assembly on Friday and said that the government has identified five focus areas — agriculture, health, human resources, transport, and industry — offering an estimated outlay of ₹1,15,215 crore in FY ’23 and ₹4 lakh crore over next three years.
Pawar presented what experts called a “please-all” budget of ₹4,27,780 crore with an estimated deficit of ₹24,353 crore and announced sops for various sectors. The main budget outlays for the five focus sectors included ₹46,667 crore for human resources, ₹28,605 crore for transport infrastructure, ₹23,888 crore for agriculture, ₹10,111 crore for industry and energy sector, and ₹5,244 crore for health.
As an immediate relief to consumers, natural gas is expected to become cheaper by about ₹2 in the state as the Value Added Tax (VAT) on Compressed Natural Gas (CNG, used by private vehicles, including cabs) and Piped Natural Gas (PNG, used in households) has been reduced to 3% from 13.5%.
The Maharashtra Vikas Aghadi (MVA) government has set the target of making Maharashtra the first state in the country to have $1 trillion economy by 2025, Pawar said, while presenting his third budget.
Chief minister Uddhav Thackeray said that the budget will provide a much-needed boost to the state economy. “We have been battling with the global pandemic for last two year. Wading through it successfully, we wish to take the state economy to another level. We have taken care of all stakeholders of the society while presenting the budget.”
The Covid-19 pandemic in the last two years and the economic crisis that resulted from it has led to an increase in the debt burden on the state exchequer of Maharashtra, which is expected go up to an estimated ₹6.49 lakh crore in this financial year, according to the state budget.
Among the big-ticket health infrastructure announcements, the finance minister proposed 100-bedded women hospitals in16 districts of the state. Pawar also announced that the state planned to set up Indrayani Medicity, a health and wellness complex on a 300-acre plot near Pune, which will be the first medical colony in the country catering to all kinds of treatment. The budget allocated ₹1,392 crore alone for strengthening health infrastructure, including repairs of 49 hospitals, and earmarked ₹100 crore to set up trauma care centres outside Mumbai.
With an eye on civic polls slated to be held in major cities, including the Mumbai Metropolitan Region (MMR), in the coming months, Pawar announced the extension of Metro 3 line (Colaba to Seepz). The underground line will now be extended till Navy Nagar through Cuffe Parade. The power transmission capacity for Mumbai will be increased with four transmission lines and sub-stations — a significant move in the backdrop of power outage witnessed in several parts of Mumbai last month.
To provide relief to over two million farmers who are repaying their crop loans, Pawar announced a one-time grant of up to ₹50,000. Loans worth ₹964 crore to 34,788 farmers in the state disbursed by the land development banks have been waived off. The state will also invest ₹10,000 crore over the next two years to strengthen the agricultural produce marketing committee (APMC) network. Apart from this, district-wise clusters will be formed to export agricultural commodities, Pawar said.
“Our major thrust is on the spending on the capital expenditure and social sector so that more liquidity is pump into the market giving a boost to the Gross Domestic Product (GDP). We have spent ₹63,000 crore on capital expenditure in FY 21-22, by borrowing ₹90,000 crore. The improved revenue generation over last year’s generation helped us in increasing the expenditure by over ₹1 lakh crore in a year. We restricted our borrowings to 3.5% of the SGDP, despite having reduced the revenue receipts due to the Covid-19 pandemic,” Pawar said.
An investment of ₹1.89 lakh crore in industries which will result in an expected 330,000 jobs was also part of the budget announcements.
As part of its budget outlay for human resources, the state will set up innovation hubs in all revenue divisions (allocating ₹500 crore for each), to encourage start-ups with guidance facilities. ₹100 crore has been earmarked to provide scholarships to girl students. Pawar also announced the setting up of the Lata Mangeshkar international college for music, in honour of the famed singer who died last month, earmarking ₹100 crore for this. Additionally, ₹1,020 crore will be used to promote education for the children from Other Backward Class (OBC) communities.
In a bid to boost the infrastructure development in the state, the government allocated ₹27,517 crore for the development of infrastructure, road development and transportation projects in the state. The state government announced an extension of the Mumbai-Nagpur Expressway (Maharashtra Samruddhi Mahamarg) till Bhandara-Gondia and Gadchiroli, which lie to the east and south east of Nagpur, respectively. Key road connectivity projects including Revas-Reddy coastal Road in Konkan region and Pune Ring road project, which aims to reduce congestion in Pune city, were also announced.
“Hinduhrudaysamrat Balasaheb Thackeray Maharashtra Samruddhi Highway will be extended from Nagpur to Bhandara-Gondia and Nagpur to Gadchiroli,” Pawar said, adding that 77% of the expressway work was already completed. The proposed extension is the second such on the 701-km expressway — last year, the Jalna-Nanded arm of the expressway was proposed. A new airport has also been proposed in Maoist-affected Gadchiroli district, while cargo and night-landing facilities would be developed at the Shirdi airport.
To boost ridership on the water taxi service between Mumbai and Navi Mumbai, Pawar said that the tax levied by the Maharashtra Maritime Board (MMB) will be waived starting January 1, 2022 for a period of three years.
Maharashtra plans to increase the share of electric vehicles in new vehicles registered to 10% for private vehicles and 25% in public transport by 2025, the finance minister said. Accordingly, a target of 5,000 charging facilities by 2025 has been set. Besides this, a 2,500 MW capacity solar energy park will be developed, and 577 MW solar power projects will come up in Latur, Dhule, Washim, Yavatmal and Chandrapur.
The budget also contained several announcements aimed at pleasing various sections including the Maratha and OBC communities, whose political reservation was recently nullified by the Supreme Court.
₹250 crore was earmarked for development schemes through the Mahatma Jyotiba Phule Research and Training Institute and ₹1,020 crore was allocated for post-matric scholarships for OBC students. The budget has also earmarked ₹250 crore for Chhatrapati Shahu Maharaj Research, Training and Human Development Institute (SARTHI) which implements development schemes for Marathas.
The tax revenue of Maharashtra is expected to go up by 11.8% in FY-23 to ₹3.08 crore as compared to current fiscal. Capital receipts are expected to jump by 7.9% to ₹1.45 lakh crore over the allocation in the current FY-23.
Leader of opposition and former chief minister Devendra Fadnavis said the budget “failed” to make any real difference. “The budget has failed to give any boost to the development projects or allocation for welfare schemes. The state government has made allocations to take forward the projects announced by our government. The incentive scheme for the farmers paying their loans regularly was announced two years ago, but could see light of the day in this budget. Beside it, there is nothing for the farmers, the agriculture sector or for the irrigation projects. It has also failed to give respite from the high petrol-diesel rates by reducing the state taxes. The budget appears to have the provisions for a few select constituencies, represented by the heavy weight leader of the MVA.”
Rupesh Keer of Samarthan, a non-profit organisation which analyses the state budget, said that though the government has been claiming to have increased the spending on expenditure, it actually has reduced. “The capital receipts in FY 22-23 are ₹92,147 crore against which they are spending ₹67,243 crore on capital expenditure, which is around 17% of the total revenue. The revenue expenditure has increased sizably leading to the substantial rise in debt burden,” he said.
Retired Indian Administrative Services (IAS) officer and state former finance secretary Subodh Kumar said, “The capital expenditure outlay was around ₹25,000 crore in 2007-08, when I was the secretary, and it has increased just to ₹67,000 crore after 15 years. This is not a good sign. It should have increased at least over ₹1 lakh crore.”