Amidst the economic slowdown economists forecast a 5 to 10 per cent drop in the Budget estimates for FY 2019-20; Cost-cutting measures likely
Hyderabad: With the economy slowing down drastically, concerns over the Budget estimates are intensifying. Experts forecast significant cuts in allocations. On September 9, Chief Minister K. Chandrasekhar Rao may present Rs 2 lakh crore Budget for the financial year 2019-20. Revenues for Telangana were earlier expected to be Rs 1,32,629 crore, however, this seems to be doubtful amid a drop in GST revenues. The nation-wide GST collections for August have slipped to below Rs 1 lakh crore. Cash-strapped Telangana government is likely to adopt more cost-cutting measures.
Mr Chandrasekhar Rao presented a Rs 1.80 lakh crore vote-on-account Budget with a revenue expenditure of Rs 1,33 lakh crore in the state Assembly. On September 9, Mr Chandrasekhar Rao will present a full Budget. Amidst the economic slowdown and increased pressure on allocations to irrigation, welfare schemes and other development projects in the state, economists expect a 10 per cent drop in Budget estimates. Mr Chandrasekhar Rao-led Cabinet is scheduled to meet at Pragathi Bhavan on September 8 to approve the full-fledged Budget for the 2019-20 fiscal.
Telangana had a surplus of Rs 353-crore Budget for the financial year 2018-19. The total Budget for 2018-19 was Rs 1.74 lakh crore, and this was 22 per cent higher than 2017-18 Budget. However, this increase we may not see full Budget for the financial year 2019-20.
The TRS government is banking on tax revenues, which rose by 17 per cent in 2017-18, the first year of GST implementation. This growth in tax revenues may not be possible in the current financial year as the state’s own tax revenues (SOTR) are under pressure, said analysts. Adding to this, Telangana’s share in the Central tax revenues would also shrink owing to drop in GST revenues across the country. Considering these factors, economists forecast 5-10 per cent drop in the Budget estimates for 2019-20 financial year, in it’s in realistic terms.
Further, the creation of more number of gram panchayats will also put more burden on the exchequer. The state government is proposing to grant Rs 8,000 crore for the current financial year to 12,000 gram panchayats. This allocation will take the total amount of Rs 40,000 crore over the next five years.