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Wednesday, Mar 23, 2005

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Petrol, diesel to cost more in Punjab

By Our Staff Correspondent

CHANDIGARH, MARCH 22. The Punjab Government has decided to impose another cess on sale of petrol and diesel to mop up approximately Rs 100 crores to fund its initiatives on agriculture diversification and rural rejuvenation. At the same time it has decided to waive the levy of entertainment duty on all State, national and international sports events organised by recognised associations.

These proposals were announced by the State Finance Minister, Surinder Singla, while presenting the annual budget for the year 2005-06 in the State Assembly this morning. While the total budget size was fixed at Rs 27,691.33 crores, it showed a revenue deficit of Rs 2118.46 crores, which was about Rs 800 crores less than the last fiscal.

Mr. Singla projected a Rs 148.23-crore surplus as the closing balance in the annual financial statement, while the annual plan has been fixed at Rs 3550 crores as against a revised outlay of Rs 2750 crores for the 2004-05 financial year. The State expects to receive Rs 2100 crores from the Centre on account of revenue deficit allocations, additional devolution of Central taxes and project specific grants.

The Minister said that in keeping with the national consensus, the State Government was committed to implementing the new value added tax (VAT) regime from April 2005, for which relevant legislation would be enacted during the current session. He said that the State's VAT legislation would have three unique features of minimising interface between inspectors and tax payers, allowing complete input tax credit (ITC) and being more trustworthy of the tax payer as it would have no penal provisions.

However, Mr. Singla's budget speech provoked a protest from the Opposition benches, who demanded that the address be made in Punjabi instead of English. As their requests were not entertained the Akali and BJP members staged a walk-out with in eight minutes of the Minister beginning the speech and boycotted the remaining portion of the proceedings for the day. Mr. Singla took a dig at the Leader of the Opposition, Parkash Singh Badal, pointing that latter's son, Sukhbir Singh, an MP, has recently addressed the Lok Sabha in English.

Mr. Singla said that while the Punjabis were the most globalised citizens, external sector contributed a meagre six percent to the State's Gross Domestic Produce (GDP). He outlined a strategy, the "New Paradigm of Public Management'' (NPPM), to deal with the state's economy, which has been growing at a rate lower than the national averages. The new paradigm focuses on leveraging public funds for attracting private capital and improving the quality of public expenditure.

It was noteworthy that while Mr. Singla stressed the need for "Reinventing Government'', he made some bold confessions about the government having failed to maintain the quality of services and delivery system in the public sector, for which he proposed the involvement of private sector as an answer. He identified construction of roads, completing Industrial Training Institutes (ITIs) and Polytechnics, management of some health services, schools, water supply, sewerage and solid waste management as a few public services where involvement of the private sector would provide cost effective services.

Mr. Singla announced Rs 5 crores as one-time grant for the setting up of "Sardar Swaran Singh Institute of International Diplomacy''. Named after the late Congress leader of the State, who later became the country's Foreign Minister, the Institute would be set up in New Delhi.

Outlining the priorities of the government in the forthcoming financial year, the Minister said that major thrust of the Annual Plan was on the Energy Sector, which cornered 25 percent of the outlay and the Social Services Sector, which accounted for 25.20 percent allocation. The government has decided to create a dedicated fund of Rs 450 crores to ensure timely payment of pensions to the aged, widows, destitute, disabled and orphans. In the transport sector, which got 20.15 percent of the plan share, stress would be laid on strengthening the road network in the state.

While Agriculture and Irrigation accounted for 4.02 percent and 6.25 percent allocations respectively, the state government proposed to create a Rs 20-crore `Agricultural Diversification Research and Development Fund' to improve varieties of alternative crops, farm practices and post harvest management practices.

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Petrol, diesel to cost more in Punjab