The Hindu : Andhra Pradesh News : Rosaiah confident of bridging revenue deficit gap Targets to be fixed for departments like Commerci

Online edition of India's National Newspaper
Friday, Jun 25, 2004

Andhra Pradesh

Andhra Pradesh

Rosaiah confident of bridging revenue deficit gap Targets to be fixed for departments like Commerci

By S. Nagesh Kumar

HYDERABAD, JUNE 24. Having reduced the State's revenue deficit by Rs. 934 crores through the single device of scrapping all unproductive schemes introduced by the Telugu Desam Government, the Finance Minister, K. Rosaiah, is confident of bridging the remaining gap of Rs. 1,970 crores, though gradually.

Revenue deficit -- the gap between receipts and expenditure --- has been a constant feature of all the ten budgets presented between 1994-95 and 2003-04 when the TDP was in power. This reversed the revenue surplus of Rs. 232.28 crores achieved for the first time after several years by the Congress Government in 1993-94 before it conceded power to the TDP.

The Finance Minister and his team are far from worried over the question of containing the revenue deficit. For one, the Rajasekhara Reddy Government has done away with all the schemes, which Mr. Rosaiah described in his budget speech as `unproductive and unviable'. These include Janmabhoomi, One-crore boons, Aadarna, Mundadugu and all other schemes involving giveaways to different sections of people.

However, the Government's strong belief that it can repeat the 1993-94 scenario lies in the fact that Andhra Pradesh stands next only to Maharashtra in terms of highest growth rate in tax revenues. "We are registering an organic growth of 14 to 15 per cent every year in revenues. In real terms, we expect an additional tax accretion of Rs. 4,771 crores during the current fiscal," said D. A. Somayajulu, Advisor to Government (Economic Affairs & Policy Implementation).

Between 1995-96 and 2003-04, the revenue receipts almost trebled from Rs. 9.874 crores to Rs. 27,410 crores. So has the expenditure. The Government has now changed the strategy by raising the 2004-05 plan size by Rs. 2,320 crores in tune with the anticipated growth in revenue.

"We will invest more on capital expenditure as the Planning Commission itself has said that every rupee invested by the Government on creation of capital will generate many more through the private sector.

Our economic model is distinctly different from Chandrababu Naidu's. He believed in creating a US-type of environment in the hope of attracting private investment," Mr. Somayajulu said.

Mr. Rosaiah is optimistic of further improving revenue receipts by fixing targets for revenue-earning departments like Commercial Taxes, Excise and Transport. "Last year, bicycles were purchased for distribution to college-going girls at Rs. 950 apiece while the actual cost was Rs. 612. We will not allow such indiscipline."

The Finance Minister, however, hastened to add, "I am not naïve to proclaim that the revenue gap will be wiped out.

We will reduce it next year, balance it the year after and try to show a surplus before the end of five years. Even a surplus of ten rupees will be a big achievement after ten years of deficit."

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