J&K economy has taken off: Drabu

Shuchismita. Dated: 1/12/2018 11:06:59 AM

JAMMU, Jan 11: Finance Minister Dr Haseeb Drabu Thursday stated though the “state’s economy is not exactly in the pink of health, yet it has really ‘taken off’.”
“This is evident from the simple fact that this time we’ve a balanced budget with no deficit while last time we had a deficit of Rs 3000 Cr,” he said.
In the same breath he averred that amnesties, plethora of sops for employees, industries and other sectors announced by him in J&K’s budget for 2018-19 were an off-shoot of “Natural Justice” and not given with an eye on (Panchayat) elections.
Drabu was addressing a press conference after presenting the J&K General Budget for the fiscal 2018-19, which he described as “a budget with a conscience and with the heart which reaches out to people.”
He stated though as an economist he did believe `amnesties per se make for bad economics’ yet while announcing reprieve `distressed sectors’, he was watching situation, the plight of people and economics. “This is natural justice. As a Finance Minister, I cannot do away with it. This is compulsion to take the people and sectors in distress out of morass. So when I saw the improved financial situation, I decided to pass on the benefits to people in distress,” he said.
Did it mean that the state’s finances were in rosy state of health, replying to this query, the Finance Minister said, “No I won’t say that. But yes, economy of the state has really `taken off.’ It is looking up as compared to previous years though certain sectors still need our support. I hope and pray that we’ll have a peaceful environment. But the finances of J&K government as of today are looking very good to me, not just as a Finance Minister but as an economist also. Honesty speaking, this was the least complicated budget for me. We’ve a balanced budget with no deficit while last time we had a deficit of Rs 3000 Cr,” he said.
NO POLITICAL MOTIVES BEHIND AMNESTIES: He sought to reject the contention that the slew of amnesties, waivers and plentiful sops for different sections of the society in his budget were actually aimed at serving political end in the wake of ensuing Panchayat polls.
“No, we’ve not taken these steps eyeing elections. It’s done with a genuine intention to take the industry, trade and other sectors in distress out of morass. Once we stablised our system and our financial situation, our resources improved, we thought we should transfer these benefits to them. Hence we made this genuine effort to provide them reprieve, not to reap electoral benefits,” he said.
ON SEPARATE PANCHAYAT BUDGET: He stated that separate Panchayat budget was necessary to ensure that the “institutions of local governance become fully functional both in terms of functions and finances. In the same breath, he clarified that the practice of separate power budget was started as it was destroying the state’s finances. “We’re in deficit so we started separate power budget and focussed on it, in last three years we gave then generous money. They got from PMDP as well. So in case of power, there’s no problem of funding, now they are confronting operational problems,” he added.
ON GST BLUES: Drabu maintained that the state did not suffer any losses on account of GST because there was compensation clause in the GST Act.
ON CONSUMERS NOT GETTING GST BENEFITS: With regard to consumers not getting Goods and Services Tax (GST) benefits, Drabu stated that it would take some time to trickle benefits to consumers.
“See it has been implemented just six months ago. So it will take some time to reach to consumers the benefits, they were promised. In fact some problem was on our account too in the GST legislation, at the national level. There were technology glitches. It was not perfect. It cannot complete even one circle so far. Even July deadline has been extended to January, 2018. Once one circle gets completed, the consumer will get benefit. Second thing on which I’m trying in the GST Council is to separate (keep) MRP out of GST regime as they cannot go together. Then we’ve taken out certain things out which are disturbing the system so it will take another three-four months for it to be in place,” he said.
How he would cope-up with the burden of expenditures to be incurred on account of 7th Pay Commission, sops for employees, amnesties, waivers for industries, traders in the backdrop of economic downslide on account of demonetization and GST implementation. Confronted with this query, Drabu said, “It has already been provided for in the budget in my Estimates for 2019.”
“Budget is not meant for employment generation. For that purpose, there are many government schemes already in progress. If industry revives, trades flourish, they will create employment hence our focus is on revival of industries/trades in distress, horticulture etc.,” Drabu said.
Responding to a question as whether the slew of amnesties for the ‘government employees, billionaire businessmen, traders, orchardists’ was an appeasement, the Finance Minister said, “It’s not an appeasement as the amnesties were not provided to the billionaire industrialists. You need to visit the industries in Jammu to know the ground condition. The industries are in real distress and need immediate support of government. They are facing lot of problems. Once they earn, only then they can be taxed.”
He stated that it was not possible for the state government to fund the salaries of employees working under the central government schemes.
“Firstly, they are not central government employees. There are central sector schemes under which they are employed under a contractual agreement for a particular duration. Once the schemes end, their services end. The funding for that scheme is done by the Centre for that particular period. Once the scheme ends, the Centre stops funding. A good chunk of contractual employees/casual workers, who were regularised recently, were actually the employees under the central government schemes. But this cannot go for long. The state government, which already has an army of its own 4.5 lakh employees, has not so much resources to employ those working under central government schemes, after the end of their contractual term. There’s a system in place and we’ve to go by that,” the Finance Minister said.
“It’s a budget with a conscience and with the heart which reaches out to people. With these measures along with the welfare steps taken in the past, I hope whole narrative in the society will change and we’ll find the civil society is much more vibrant. Hopefully if peace prevails and the tourism picks up, this will trigger off a road to recovery for the state, not just in terms of state’s economy but the polity and civil society as well,” the Finance Minister said.



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