Home Finance Centre Supports Odisha With More Borrowings

Centre Supports Odisha With More Borrowings

Bhubaneswar: Union Minister of State for Finance Anurag Singh Thakur has said that the Union Government is supporting all states, including Odisha and allowing additional borrowing to ease revenue position.

In an exclusive interview via e-mail by Tathya News Agency on Union Budget 2021-2022 and Economic Survey 2020-202, Singh revealed that Odisha has been allowed additional borrowing of Rs.7145 Crore to ease stress on revenue position.

Tathya : Odisha’s share tax was budgeted at Rs.36,300 crore in 2020-21 (Budget Estimate), which has been reduced to Rs.25,460 crore in revised estimate. This will worsen the revenue position of Odisha. How does the Centre plan to help the State to tide over the situation?

Thakur: We have supported all the states, including the state of Odisha sufficiently. We increased the borrowing limits under the GSDP from 3 per cent to 5 per cent. The state of Odisha has already been allowed additional borrowing INR 5,716 crores and over and above that, it has completed 1 of the 4 reforms which has led to release of INR 1,429 crores taking the overall additional borrowing to INR 7,145 crores. We have also released the central share of State Disaster Response Fund (SDRF) to the states including Odisha in the first week of April, 2020. A total amount of INR 11,565.93 crores was released to the states including INR 802 crores to the state of Odisha.

Tathya: Odisha Government is requesting Sharing Pattern in Centrally Sponsored Schemes at Par with North East and Himalayan States as the State is most vulnerable due to Major Natural calamities. Will ‘Natural Calamity’ be included as a criteria for providing similar facilities in case of the states, like North East and Himalayan States?

Thakur: There is no such plan of including ‘Natural Calamity’ as a Criteria at the moment.

Tathya: A declining trend in devolution of State’s Share in Taxes has been witnessed over the years. Will the Government of India arrest the trend as it conflicts with fiscal federalism as enshrined in the Constitution of India?

Thakur: There is no declining trend in devolution of state’s share in taxes. The devolution to the states decreased from 42 percent to 41 percent as a result of Jammu & Kashmir moving to the Union Territory and their share will be paid from the union’s share.

Tathya: Cess and Surcharge are not shared by the Union Government with State Governments. Will  the Government of India eliminate Cess and Surcharge on Customs duty and Direct Taxes in a phased manner?

Thakur: There is no such plan on elimination of any cess and surcharge on customs duty and direct taxes at the moment.

Tathya: Central Transfers one of the methods to reduce disparity between rich and poor states. It is noticed that central transfers to states are going down and how are you going to address the issue in the budget for 2021-21.

Thakur: Central transfers to states are not coming down and we have accepted the Fifteenth Finance Commission’s recommendation of 41 percent devolution to the states. The states have been adequately supported during the pandemic as well by the Centre and the RBI.

Tathya: One of the biggest challenges faced by youth is unemployment. What steps have been taken to address the issue in Budget 2021-22.

Thakur: Spending on capital expenditure leads to a very high multiplier effect of close to 2.5. This will lead to job creation as we will spend on building roads, railways, ports, cold storages, warehouses, airports etc. We have announced the creation of 7 Mega Textile Parks in this budget which  will generate lakhs of jobs. We are spending close to 1.97 lakh crores on the PLI scheme which are manufacturing intensive and will generate jobs. Our focus is to make India a leader in the skilled workforce and we will strive to work towards that.