Punjab CM seeks debt-relief package from Finance Commission to revive state’s fiscal health
Speaking at a meeting with the commission team headed by NK Singh, the Punjab CM expressed concern over the permanent loss of revenue suffered by the state following the implementation of the Goods and Services Tax (GST).india Updated: Jan 31, 2019 14:10 IST
Chief minister Amarinder Singh on Wednesday sought from the 15th Finance Commission a special debt-relief package to revive the state’s fiscal health and one-time package to enable payment of the entire debt of the distressed farmers.
Speaking at a meeting with the commission team headed by NK Singh, the CM expressed concern over the permanent loss of revenue suffered by the state following the implementation of the Goods and Services Tax (GST). “The GST compensation from the Centre will also end from July 1, 2022, resulting in a drastic fall in revenue in the range of Rs10,000-12,000 crore per annum,” he added.
The CM urged the commission to recommend a graded compensation tapering formula to the Centre for states like Punjab beyond June 30, 2022, in view of the loss so that they do not simply ‘fall off the cliff’. He submitting a formal memorandum to the commission.
He said the internal security threat arising out of a hostile neighbour and threat of spillover of J&K militancy, along with the problem of drugs, further made the state a fit case for a special package. The outstanding debt of the state, which was Rs1.96-lakh crore on March 31, 2018, is estimated to touch Rs 2.11-lakh crore at the end of financial year 2018-19.
On the issue of agricultural loan, the CM said there was need for a comprehensive package and assistance from the Centre, said Captain Amarinder. He also requested the commission to provide for deficiency price support in maize and cane production to the extent of Rs 12,350 crore and Rs 300 crore, in order to give a boost to the allied activities in the farm sector. He also sought seeking project-special grants for water cycle management, piped potable drinking water supply, river cleaning programme, expansion and strengthening of Outpatient Opioid Assisted Treatment (OOAT) clinics to rehabilitate patients of drug abuse and expansion of health infrastructure.
The CM mooted increase in devolution to states to allow greater flexibility, seeking an increase in Punjab’s share in devolution from 1.5% to 2%. The state’s share in funds had reduced from 2.45% to 1.57% in the last 40 years.
Finance minister Manpreet Badal raised objections to the industrial concessions given to the neighbouring states, asserting that the central government had no right to destabilise industrial set-up in any state by offering concessions to neighbouring states. Cabinet ministers Brahm Mohindra, OP Soni, Tript Rajinder Singh Bajwa and Charanjit Singh Channi, OP Soni were also present.
First Published: Jan 31, 2019 14:10 IST