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Problem Of Plenty

Bhubaneswar: As the New Year has arrived, people talk about the challenges in store for Odisha. Severely hit by COVID-19 pandemic’s second wave all along 2021, people are apprehensive of the new year. How will the year fare for Odisha and its people? With natural calamities becoming a routine affair and the state developing resilience against disasters, nobody these days is worried about cyclones or floods. The perennial problem of Left-Wing Extremism is almost under control, though organized crimes and cyber offenses have emerged as a new challenge for the state.

However, what is the real challenge for Odisha in 2022. Is it the back-to-back elections like rural, urban or cooperative polls throughout the year 2022! Yes, it is certainly a challenge. But what has come as a fresh as well as the future challenge is from the economic front. This challenge is certainly new for the state and the people at the helm.

The state which was facing problems to meet its daily expenses and going for overdraft for 364 out of the 365 days in a year when Naveen Patnaik government took over in 2000, has witnessed a sea change in the situation. The state has also seen days when its Chief Ministers used to rush to Delhi with begging bowls and sometimes were to be rebuffed with sardonic remarks such as “money does not grow on trees.” Calamities claim at least Rs 10,000 crore every year, which certainly has broken the state’s financial backbone. Notwithstanding all odds, the state has overcome all difficulties, thanks to Naveen for providing a stable government in the state.

Odisha is no more a poor state, depending on others for its food security. Rather, it has emerged as the third from the top in the list of states in India contributing to the Central food basket. Thanks to the farmers’ resilience against calamities and government schemes, the scenario has changed.  

Though opposition political parties criticize the BJD government for failing the state on all fronts, all must now admit that Odisha is not in the situation as it was in the 1980s and 90s. The state is now surplus in food and power. Odisha’s revenue generation has increased manifold and so also its budget size. If it is so, what is the problem then?

The problem actually lies in the plenty of resources which have come to the state through several means. Though not a rich state, Odisha has generated enough revenue to undertake developmental works and make provision for long-term income. While the State Government has set a target to collect both Tax and Non-Tax Revenue to the tune of Rs.57,500 Crore during the Financial Year of 2021-22, it has crossed the target.

As far as mining revenue is concerned, Odisha aimed for   Rs.13,700 Crore during the Financial Year 2021-22. But the State has already collected more than Rs.30,000 Crore by Mid-December. Due to the mining boom, the mineral-rich Odisha has been collecting ‘bumper revenue’ and the State is now having abundant resources to use. So, now it has to deal with the ‘problem of plenty’.

Odisha, in fact, is facing a unique situation like a ‘poor man getting a lot of money’ in his pocket. The man often loses sight and goes on a spending spree, making no plans. This exactly is the situation of the state where money is flowing and it needs to be properly utilised. Odisha can make a lot of progress; let it give a thought on how the public money is to be spent.

Now comes the issue of utilization of the resources for the long-term benefit of the State. Else, the Government will be facing the ‘resource curse’ by spending on short-term programs, meant to appease people. Odisha will be facing three elections back-to-back. Rural, Urban and Cooperative Polls are to be held this year.

The past one month has seen mind boggling spending on populist programs. It seems that such a splurge is ever on the rise and will continue for more years. The trend looks like that. Only in a month’s time, the Odisha Government has announced such populist programs costing the State Exchequer over Rs.3000 crore. On the last day of the 2021, the State Cabinet announced implementation of the seventh pay commission recommendations for school and college teachers, free-of-cost homestead land for the slum dwellers in five municipal corporations. All these are intended to appease certain categories of people.

It may be a wise decision to invest in teachers, but there is no logic for the free of cost land for the slum dwellers. The inhabitants of the slums in cities are not the people living in dense forests or PVTGs. They are, in fact, an earning class, maybe in small amounts. But, the 1.90 lakh households are being provided with free land. Can’t they contribute Rs 1,000 each to get a plot in the cities? If they pay at least a thousand rupees, the state can generate at least Rs 19 crore. If the amount increases, resource size will also rise.

This amount can then be invested in various income-generating projects for the very slum dwellers. This apart, the government has been providing Re 1 a kg rice to the BPL families across the state and it costs State Exchequer hugely. The instance of free of cost land under Jaga Mission of the state is just one case. There are several ways in which people are appeased. The people are constantly pampered and the decision makers at the helm are planning more and more schemes before elections.

It is high time the state thought and acted judiciously and utilized the public money in the proper way to make Odisha strong. More investment should come in capital expenditure and there is no harm if the government goes for austerity at this point of time. Austerity measures should be undertaken not only when the state is facing a financial crisis but also at a time when there is a good amount of revenue coming to the coffers. It would be prudent to channelize the resources properly. If the BJD government succeeds in money management in 2022, Naveen can certainly write another page in the history book. 

The Reserve Bank of India, which is keeping constant watch on spending of the State Government, has advised the policy makers to go for more spending on ‘Capital Account’, which seems sadly missing in the State.