More increase in CAPEX than Revenue Expenditures
Nishikant Khajuria
JAMMU, July 30: Jammu and Kashmir Union Territory Budget Plan for 2024-25 reflects a positive outlook with significant economic growth as well as GSDP and reduced fiscal deficit in comparison to the previous financial year .
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The document detailing fiscal strategy for the financial year 2024-25 under the Fiscal Responsibility and Budget Management (FRBM) Act, 2006, presented by the Finance Department, estimates 7.5 percent Gross State Domestic Product (GSDP) for the current financial year, which is equivalent to the previous fiscal.
With the growth rate of 7.5 percent, GSDP in 2024-25 is estimated to remain Rs 2,63,399 crores in comparison to Rs 2,45,022 crores in the last financial year while total Revenue Receipts are expected to increase to 98,719 crores in 2024-25 , in comparison to Rs 84,603 crores in the last fiscal.
Total Revenue Receipts of Rs 98,719 include Rs 20,869 crores own Tax Revenue, Rs 9,726 Own Non-Tax Revenue, Rs 67,133 crores Central Transfers and Rs 1000 crores from Additional Resource Mobilization (ARM)/Asset Monetization/CRISP.
On the other hand, total Capital Receipts for the current financial year have been projected to decrease from the last fiscal when it was all time high. Fiscal indicators project Rs 19,671 as Capital Receipts for the year 2024-25, which is 16.63 percent lower than the year 2023-24 when Capital Receipts were Rs 23,594 crores. The projected Capital Receipts for this year include Rs 19,612 crores Borrowings and Other Liabilities.
In Rs 1,18,390 crore J&K Budget for the year 2024-25, the total Expenditure includes Rs 81,486 crores Revenue Expenditure and Rs 36,904 crores Capital Expenditure.
In comparison to the previous year, the Revenue Expenditure is projected to slightly increase to 7 percent while the Capital Expenditure is estimated to increase 15.17 percent. Significant increase in the Capital Expenditure indicates a robust investment in the development of the J&K Union Territory.
Revenue Expenditure for the year 2024-25 includes Rs 29,412 crores for salaries/wages of Government employees, Rs 14,058 crores for Pension Payment, Rs 1943.20 crores for salary of Public sector employees, Rs 1392.94 crores for the aided Institutions, Rs 815.21 crores for the Aided Local Bodies and Rs 10,272 crores for Interest Payment.
Significantly, Salary/Wages component of the Revenue Expenditure this fiscal has decreased to 3.80 percent from the year 2023-24, when it was Rs 30,575 crores. In the year 2023-24, there were total 3.61 lakh Government employees in Jammu and Kashmir Union Territory.
As per the Budget document, the fiscal deficit is targeted at 3 percent of the GSDP for 2024-25, which is a significant improvement from the previous year’s 5.36%. The fiscal deficit has been brought within FRBM limit due to higher level of central transfers, which are 12.51 percent more than that of year 2023-24.
However, the Government’s liabilities are projected to increase, with market borrowings constituting a major part of this debt. The outstanding amount of market borrowings by the end of year 2022-23 was Rs 55,636 crore
Further, by the end of last year, Rs 355.34 crores was the outstanding amount on account of major works and contracts, Rs 14.3.34 crores on liabilities in respect of land acquisition and Rs 1027.65 crores on account of claims in respect of unpaid bills on works and supplies.
The FRBM Act mandates the presentation of various fiscal statements to ensure transparency and accountability. These include the Macro Economic Framework Statement, Medium Term Fiscal Policy Statement, and the Fiscal Policy Strategy Statement. The FRBM Act puts limits on Government borrowing under a time bound programme to altogether eliminate revenue deficit and bring down fiscal deficit to prudent limits.
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