Bhubaneswar: While Annual Budget formulation is going on in Odisha the size of the State Annual Budget for 2023-24 is likely to cross Rs.2.40 Lakh Crore Mark.
According to financial analysts as a percentage of GSDP, the size of the Budget has remained within the range of 20 % – 25% with minor inter-year variations.
So with Annual Budget for 2022-23 was Rs.2 Lakh Crore and with 20%-25% variation it is expected that Annual Budget for 2023-24 is likely to have a much bigger one.
As per the latest IMF projection, the world economy is expected to grow 3.2% this year, before slowing further to a 2.7% in 2023.
RBI has projected India’s economy to grow around 7.2% during this fiscal and will have a growth of 6.5% during 2023-24.
In case of Odisha, the economy is projected to register higher growth of about 8% in 2022-23 as well as in 2023-24.
Analysts pointed out that the Budget formulation is now based on the micro-economic outlook and the fiscal framework envisaged in the fiscal responsibility legislation with an objective to counter the deficit bias and maintain a sustainable fiscal position.
It also takes into account implications of key public policy decisions and factors in the risks to public finances.
Thus, maintenance of fiscal sustainability is the primary concern of the budget formulation process.
The sustainability indicators mainly give an idea about the adequacy of current revenues to meet revenue expenditure obligations, application of borrowed funds for capital formation, liquidity in the system to discharge committed liabilities and development expenditure and a sustainable debt stock and debt servicing liability.
In the short and medium term our focus would be on arresting the decline in the level of revenue surplus though appropriate revenue augmentation and revenue expenditure rationalization measures.
Over the next three years, Odisha plans to maintain a fiscal deficit consistent with the requirements of the FRBM legislation and will produce a sustainable medium-term debt stock trajectory.
However, if there is need for additional fiscal stimulus in FY 2023-24 to support the economy, the State can use the fiscal space which remained unutilized in FY 2022-23.
This carry forward is allowed as per the recommendations of the 15th Finance Commission.
The debt stock is expected to remain well within the FRBM prescribed limit of 25% of GSDP in medium term. Odisha’s overall fiscal outlook remains stable over the medium term, officials say.