Thread: Highlights Of Karnataka’s Budget 2008-09

HIGHLIGHTS OF KARNATAKA’S BUDGET 2008-09

OVERVIEW OF THE BUDGET

1.The Budget of Government of Karnataka for 2008-09 with an outlay of
Rs.56542.15 crores from the State Consolidated fund has been
presented in Parliament. The Budget focuses on promoting “Growth
with Equity”.

2.The emphasis in 2008-09 budget will be on sustaining the economic
growth of the State while seeking to uplift the economically and
socially weaker sections.

3.In particular, the budget seeks to promote the development of human
capital in the State by enhanced investments in education, health and
social welfare. Further, the budget also seeks to initiate special steps to
improve the productivity of the agricultural sector and the economic
condition of the farmers.

4.The total outlay of Rs.56542.15 crores for 2008-09 represents an increase
of 12% over the budgeted outlay of the State for the year 2007-08 which
was Rs.50465.60 crore. The State’s annual plan for 2008-09 is to have an
outlay of Rs.21751 crores which reflects an increase of about 22% over
the 2007-08 annual plan outlay of Rs.17782.56 crores.

5.As required under the Karnataka Fiscal Responsibility Act, 2002 the
State’s budget for 2008-09 has a revenue surplus which is estimated at
Rs.2972.65 crores. This will maintain Karnataka’s record of a revenue
surplus financial position continuously since 2004-05.

6.As required under the Fiscal Responsibility Act, the Fiscal Deficit for
2008-09 will be within 3% of the State’s estimated GSDP (Gross State
Domestic Product) of Rs.244043 crores. Again Karnataka has
maintained a fiscal deficit of less than 3% of GSDP since 2004-05.

7. By maintaining the revenue surplus position and limiting the fiscal
deficit to less than 3% the State will continue to receive the benefits of
debt consolidation and wavier of central loans amounting to about
Rs.650 crores per year.

8.The Medium Term Fiscal Plan 2008-2012 presented with the budget
will be the guide for moving forward on the path of fiscal prudence
and sustainability.

9.The State’s GSDP is projected to grow at a real growth rate of 9%.
Inflation is assumed to remain at 4% during 2008-09.

BUDGET ESTIMATES 2008-09

Receipts

i The revenue receipts of the Government of Karnataka for
2008-09 are estimated at Rs.46188.70 crores. This represents a
13.31% increase over the budget estimates of Rs.40762.09 crores
and 13.09 % over the revised estimates of Rs.40840.22 crores for
2007-08. The estimate of own tax revenues of the State for
2008-09 are Rs.31445.93 crores with a projected increase of
Rs.4754.76 crores (17.81%) over the 2007-08 budget estimates of
Rs.26691.17 crores. The devolution of central taxes and grants in
aid to the State are estimated as Rs.12811.12 crores for the
financial year 2008-09.

ii.Under own tax revenues, the total collection from Commercial
Taxes is estimated to be Rs.19344 crores which represents a
growth of 17.42% over the revised estimates of 2007-08. No new
taxes are proposed in the Budget. To mobilize the resources as
projected, the focus will be on rigorous enforcement, widening
of tax base and recovery of arrears. Intensive use of Information
Technology will be made for these purposes.

iii.The total collections from State Excise are estimated at
Rs.5626.08 crores, which represents a growth of 20.51% over the
revised estimates for 2007-08.

iv.It is estimated to mobilize an amount of Rs.269.97 crores under
non-debt capital receipts. Out of this Rs.200 crores is estimated
to be mobilized from the sale of land.

Expenditure

i. The revenue expenditure of the Government of Karnataka for
2008-09 is estimated at Rs.43216.05 crores. This will result in a
revenue surplus of Rs.2972.65 crores, which continues the record
of Karnataka as a revenue surplus State since 2004-05. The
capital expenditure for 2008-09 is estimated at Rs.10168.92
crores. The total expenditure (excluding repayment of loans)
will be Rs.53384.98 crores as compared to Rs.47816.13 crores
budgeted for 2007-08. The projected fiscal deficit for 2008-09 is
Rs.6926.31 crores. As a proportion of the estimated Gross State
Domestic Product of Rs.244043 crores, the fiscal deficit of
Rs.6926.31 crores amounts to 2.84%, which is within the limit of
3% of GSDP stipulated in the Karnataka Fiscal Responsibility
Act, 2002.

MAJOR ALLOCATIONS

AGRICULTURE & ALLIED ACTIVITIES AND IRRIGATION

i. The total allocation under Agriculture & Horticulture has
increased to Rs.1564.51 crores as against Rs.1315.02 crores for
2007-08. An amount of Rs.220 crores is earmarked for special
initiatives under Agriculture and Horticulture to improve the
economic condition of farmers in the State. This is in addition to
Rs.184 crores budgeted under the Rashtriya Krishi Vikas Yojana.

ii. Important programmes under Agriculture Department like
supply of seeds at subsidized price, crop insurance, support for
farm mechanization, and subsidy for drip irrigation would
continue. It is proposed to avail maximum funds under the
National Horticulture Mission. An amount of Rs.108.35 crores is
provided under the Comprehensive Watershed Development
Project. A new initiative for recharge of Ground water is
planned with an outlay of Rs.10 crores.

iii. The total allocation under Major, Medium & Minor Irrigation is
budgeted at Rs.4542 crores. An additional amount of Rs.500
crores is expected under Government of India’s Accelerated
Irrigation Benefit Programme on account of the step up in
outlay provided in Union Budget. The Emphasis is to be on
completion of ongoing projects so as to bring more acreage
under assured irrigation.

iv. The scheme of agricultural credit through cooperative credit
institutions at the subsidized interest rate of 4% will continue.
An allocation of Rs.112 crores is provided for the same. A
similar scheme for fishermen and wea vers will also continue.

v. An amount of Rs.40 crores is provided as State support for
Yashaswini Health Scheme for members of Cooperative
societies.

vi.The allocation under Animal Husbandry and Fisheries has been
increased from Rs.487.57 crores in 2007-08 to Rs.549.23 crores in
2008-09. An amount of Rs.39.60 crores is provided under
Rashtriya Krishi Vikas Yojana and Rs.25 crores provided for
new initiatives under Animal Husbandry in line with 11th plan
objectives. Matsya Ashraya housing programme for fishermen is
to be scaled up with an outlay of Rs.15 crores. Fisheries
development under the Rashtriya Krishi Vikas Yojana is to be
taken up at an outlay of Rs.26.40 crores. The existing
programmes of strengthening of Veterinary services and
distribution of milch animals through Karnataka Milk
federation to destitute women will also continue.

vii. An outlay of Rs.138.45 crores is earmarked for Karnataka
Sustainable Forest Management and Bio-Diversity Conservation
project. Social Forestry works through Panchayats are planned
with an outlay of Rs.20 crores.

viii. The existing scheme of providing foodgrains at Rs.3/- per KG to
BPL beneficiaries through the Public Distribution System is to
continue. New initiatives in Food security planned with an
outlay of Rs.25 crores to undertake local procurement
operations for coarse foodgrains and augment the availability of
food grains in the Public Distribution System.



Source: Government of karnataka

EDUCATION

i. The outlay on education has increased from Rs.7004.31 crores in
2007-08 to Rs.8592.23 crores in 2008-09. Funds are allocated for
the existing programmes of Akshara Dasoha (Mid day meal),
free uniforms, free text books, and free bicycles. Allocation
under Panch Soulabhya which aims to provide basic amenities
like water supply, toilet facilities etc., to primary and secondary
schools stepped up from Rs.8.60 crores to Rs.112 crores. Under
this, Special emphasis will be on backward taluks with an outlay
of Rs.80 Crore. Sarva Shiksha Abhiyan Programme is to be
implemented with an outlay of Rs.940 crores in 2008-09.

ii. All New High schools, Polytechnics, Pre-University Colleges
and First Grade Colleges and Engineering colleges opened in
earlier years are to be adequately staffed and made fully
functional. Construction of new buildings for these institutions
has been given an outlay of Rs.200 crores in 2008-09

iii. An outlay of Rs.44 crores is provided for Industrial Training
Institutes sanctioned in earlier years to meet the cost of raw
material and staff. A new skill development programme
aligned with the objectives of Government of India’s skill
development mission is to be launched with an outlay of Rs.35
crores. Rs.10 Crore is also earmarked for upgradation of
existing Industrial Training Institutes into Centres of Excellence.

HEALTH AND MEDICAL EDUCATION

i. The outlay earmarked for the health sector has increased from
Rs.1869.4 crores in 2007-08 to Rs.2122.87 crores in 2008-09. A
Capital outlay of Rs.125 crore is planned for adequately
equipping and scaling up of the Taluk level hospitals,
Community Health Centres and Primary Health Centres. An
additional amount of Rs.35 crore is provided as part of the new
initiatives for improving service delivery in taluk level hospitals
in backward taluks. An outlay of Rs.101 crores is also provided
under the Karnataka Health Systems Development Project for
strengthening the system of primary health care.

ii. The Existing scheme of free health kits to the mother of new
born, telemedicine, support to autonomous medical institutes
like VIMS, Kidwai Memorial Institute, KIMS, Jayadeva Institute
of Cardiology, Indira Gandhi Institute of Child Health will
continue. Janata health fund to be provided a corpus of Rs.10
crore. An outlay of Rs.15 crores provided for opening of Burns
and Dialysis wards in District level Hospitals and Rs.25.25
crores is provided for the Suvarna Suraksha Scheme.

iii. Works on New Medical Colleges are to be expedited. An
additional allocation of Rs.80 crores was already provided in
2007-08 for this purpose. Rs.70 Crore is earmarked for the next
phase of these works in 2008-09.

WELFARE OF WEAKER SECTIONS

i. An outlay of Rs.1684.05 crores is earmarked for the welfare of
Scheduled Castes, Scheduled Tribes, Backward Classes &
Minorities as against an outlay of Rs.1425.47 crores provided in
2007-08.

ii. All existing schemes of Ganga Kalyana, Land Purchase and
reimbursement of Scholarships for Scheduled Castes and
Scheduled Tribes, Backward Classes and Minorities will
continue with higher allocations. Monthly charges for hostels
under Grant-in-aid are increased from Rs.350 per student to
Rs.450 per student for pre-matric hostels and 450 per student to
Rs.500 for post-matric hostels. Pooled funds corpus of the
Special Component Plan and the Tribal Sub Plan (for Scheduled
Castes & Scheduled Tribes) has also been increased from
Rs.187.35 crores in 2007-08 to Rs.228.55 crores in 2008-09.

iii. An outlay of Rs.220 crores is earmarked for taking up capital
works for construction of hostels and Morarji Desai Residential
Schools sanctioned in earlier years.

WOMEN & CHILD DEVELOPMENT

i.The outlay on Women & Child Development has been increased
from Rs.886.21 crores in 2007-08 to Rs.953.82 crores in 2008-09.
The existing scheme of Bhagyalakshmi is to continue with an
outlay of Rs.192 crores. Rs.9.77 crores is earmarked for
providing support to Stree Shakthi Groups and Rs.17.50 crores
for support for creation of marketing infrastructure for these
groups. A total amount of Rs.478 crores earmarked for ICDS
Scheme. Rs.25 crores is provided for construction of
Anganwadi buildings.

ii. The existing social security pensions for old age persons,
widows , physically handicapped and under Sandhya Suraksha
Scheme will continue with the monthly pension of Rs.400/- per
month.

RURAL DEVELOPMENT

i.Total outlay on rural development will increase from Rs.3064.31
crore to Rs.3350.97 crore. In addition works in all the districts
with a total outlay of Rs.1100 crores are planned under the
National Rural Employment Guarantee programme. Rural
roads maintenance is to be taken up with an outlay of Rs.350
crore. Further, an additional outlay of Rs.200 crore provided for
taking up improvement, upgradation and new roads in
backward taluks. Capital works under rural water supply are to
be undertaken with an outlay of Rs.865 crore.

ii.Minor irrigation tanks under the purview of Panchayats are to
be strengthened and their capacity augmented at an outlay of
Rs.120 crores. Out of this, special focus will be on tanks in
backward taluks for which an outlay of Rs.100 crores has been
earmarked.

iii.Suvarna Gramodaya Programme with an objective of integrated
development of 1200 villages will continue to be implemented
with an outlay of Rs.300 crore.

iv. In keeping with the tradition of Karnataka in the matter of
decentralized governance, the untied grants provided to each of
the 5628 Grama Panchayatys in the State are proposed to be
increased from Rs.5.00 lakhs to Rs.6.00 lakhs per annum. Gram
Swaraj Project with an objective of strengthening Gram
Panchayats provided with an outlay of Rs.160 crores.

PUBLIC WORKS AND INFRASTRUCTURE DEVELOPMENT

i. Public works (roads, bridges and public buildings) are provided
with an outlay of Rs.3271 crore as against outlay of Rs.3106 crore
for 2007-08. An amount of Rs.240 crore is also provided for
important roads in and around Bangalore. Maintenance of
Major district roads will be taken up at an outlay of Rs.300 crore.
This is in addition to funds to the tune of Rs.145 Crore available
for road maintenance under the Twelfth Finance Commission
grants.

ii. State highways maintenance will be taken up under the new
output based performance contracts at an outlay of Rs.50 crores.
An outlay of Rs.250 crores is earmarked for the second phase of
Karnataka State Highways improvement Project. Karnataka
Roads Development Corporation will also take up construction
and upgradation of major bridges and State Highways at a cost
of Rs.300 crores.

iii. An outlay of Rs.50 crores earmarked for the construction of the
Vidhana Soudha in Belgaum.

iv. Infrastructure development Department is given an outlay of
Rs.449.21 crores as against an outlay of Rs.418.45 crores in
2007-08. Rs.100 crores out of this is earmarked for expediting
works for setting up and upgradation of airports in Mangalore,
Mysore, Hubli, Bijapur, Shimoga, Hassan, Gulbarga, Karwar,
Bidar and Belgaum.

v. Railway projects under cost sharing arrangement with Indian
Railways to be taken up for which an amount of Rs.200 crores is
earmarked as the State’s share.

vi. An allocation of Rs.5 crores is provided for the State’s initial
equity in new Special Purpose Vehicle for undertaking the work
of providing High Speed Rail Link to the Bangalore
International Airport. An outlay of Rs.93 crores is also provided
for the State’s investment in the Bangalore International Airport.

HOUSING & URBAN DEVELOPMENT

i.The outlay on housing for weaker sections has increased from
Rs.756.93 crores in 2007-08 to Rs.875.3 crores in 2008-09. This
will help to complete all the existing incomplete houses
numbering more than 3 lakh in 2008-09 in different districts.

ii. The outlay on Urban Development has increased from Rs.4618
crores in 2007-08 to Rs.4923 crores in 2008-09. The devolution of
funds to Urban Local Bodies has increased from Rs.1904 crores
in 2007-08 to Rs.2419 crores in 2008-09.

iii. An outlay of Rs.100 crores is also earmarked for the North
Karnataka Urban Infrastructure Development Project, Rs.250
crores for the Karnataka Municipal Reforms Project, Rs.161
crores for the Karnataka Urban Development and Costal
Management project and Rs.378 crores for the Cauvery Water
Supply Project. The allocation under the National Urban
Renewal Mission scheme is pegged at Rs.900 crores.




Source:Government of karnataka

ENERGY

i. Rs.1700 crores is provided for Rural Electrification subsidy in
2008-09. In addition an amount of Rs.330 crores is earmarked
for providing capital support to transmission and distribution
companies for taking up Rural Load Management System
Project in backward taluks.

ii. The Karnataka Power Corporation Limited, the Karnataka
Power Transmission Corporation limited and the Electricity
Distribution Companies have planned to take up works with an
outlay of about Rs.2000 crore in 2008-09 to augment Generation,
Transmission and Distribution Infrastructure.

HOME & TRANSPORT

i. The allocation for Home & Transport has been increased from
Rs.1945.74 crores in 2007-08 to Rs.2442.59 crores in 2008-09. An
outlay of Rs.95 crores out of this is earmarked for police force
modernization. The work under the Karnataka State
Accelerated Fire Reforms Project for construction and
upgradation of Fire stations is to be continued at a cost of Rs.35
crores during 2008-09. The work on streamlining of traffic
management in Bangalore under the Bangalore Traffic
Improvement Project (B-Trac) is to be expedited. An outlay of
Rs.38 crores earmarked for the same.

ii. The budget provides for the continuation of the scheme of
subsidized bus passes facility for students, freedom fighters and
the disabled. An allocation of Rs.189 crores is provided as
reimbursement to Road Transport Corporations provided in
2008-09. Government is also to provide a Capital outlay of
Rs.100 crores for improvement of bus transport infrastructure in
the backward taluks.


INFORMATION, TOURISM & YOUTH SERVICES

i. An allocation of Rs.205.41 crores is provided for Information,
Tourism & Youth Services. Tourism infrastructure will be
created on public private partnership model in important
locations. Rs.20 crores is earmarked as the State’s share for the
programme. Rs.40 crores is also earmarked for maintenance and
rejuvenation of existing tourist facilities.

ii. An allocation of Rs.5 crores is earmarked for the conduct of
National Youth Games in Bangalore. The existing programme
of upgradation of taluk-level stadia will continue with an outlay
of Rs.25 crores.

iii.An outlay of Rs.143.59 crores is provided for Kannada and
Culture including a special allocation of Rs.41 crores is also
earmarked for promotion of Kannada and culture. This is in
addition to Rs.12.50 crores provided for Heritage Conservation
and Rs.1 crores each for reprint of important works in Kannada
literature and conduct of Janapada Jatre.

COMMERCE & INDUSTRIES

i. The outlay on Commerce & Industries has increased from
Rs.1421.25 crores to Rs.1484.86 crores. An additional amount of
Rs.60 crores has been provided in 2007-08 itself to clear all
backlog of investment subsidy. Thrust on creation of industrial
infrastructure is to continue with an outlay of Rs.43 crores.

ii. An amount of Rs.50 crores is provided under the One time
Settlement of loans upto Rs.10 lakh taken from KSFC as per the
scheme announced in 2007-08. The existing Weavers’ Package to
continue with an outlay of Rs.50 crores.

iii. Employment generation in the Garment sector to be focused
upon with an outlay of Rs.64 crores.

REDRESSAL OF REGIONAL IMBALANCES

i. Karnataka’s budget for 2008-09 includes a provision of Rs.2489
crores for a Special Development Plan to develop backward
areas in the State to redress regional imbalances within the State.
This represents a 58% increase over the Special Development
Plan of Rs.1571 crores which was initiated for the first time in
2007-08. The Special Development Plan outlay is mainly
directed in the sectors of Rural Development, Irrigation,
Education, Health, Roads and Transport and Welfare of weaker
sections.


Source:government of karnataka

MUMBAI: Maharashtra Finance Minister Jayant Patil on Wednesday created a record by presenting his 10th consecutive budget in the legislative assembly.

Patil, senior NCP minister who came to the assembly sporting a dhoti, kurta and a cap like a farmer, started his budget presentation with a Marathi couplet eulogising the contribution of the farmers and wishing them prosperity.

Patil has been presenting the state budget since the Congress-NCP government came to power in 1999.

Union power minister Sushilkumar Shinde had a record of pro2ducing nine consequtive budgets while he was state finance minister.

As soon as he started reading his budget, the opposition members raised slogans demanding complete loan waiver for the farmers and blank "saath bara"( land revenue document).

The slogan shouting continued for about five minutes.