PHOTO: A.M. FARUQUI

A MIXED BAG: Madhya Pradesh Finance Minister Raghavji arriving at the State Assembly to present the budget:

BHOPAL: Madhya Pradesh Finance Minister Raghavji on Tuesday presented the State budget for 2006-07 showing a deficit of Rs. 48.55 crores. The Government proposes to raise Rs. 28617.71 crores and incur an expenditure of Rs. 28397.55 crores, which amounts to a surplus of Rs. 220.16 crores. However, due to the negative opening balance of Rs. 268.71 crores, the fiscal year 2006-07 is projected to close with a deficit of Rs. 48.55 crores.

The Finance Minister announced that VAT (value added tax) would be introduced in the State from April 1 this year. Food grains have been exempted from VAT and the rates of tax under the VAT would be determined by the Central Government's Empowered Committee.

The State Government expects to rake in an additional Rs. 4 crores by hiking the entry tax on cigar, cigarettes and tobacco cigarillo from 8 per cent to 10 per cent. Similarly, the State Government hopes to generate additional revenue of Rs. 5 crores by hiking the entry tax from 20 per cent to 25 per cent on gutka and paan masala mixed with tobacco.

Roads, irrigation, power, education and health will be the thrust areas under the latest Budget. The Finance Minister said in his speech that there would be a revenue surplus for the first time after 13 years and the surplus money would be used for the much- needed capital expenditure. The budget also incorporates a Medium-term Fiscal Policy Statement as well as fiscal targets till 2009-10 to ensure adequate availability of funds for development projects. The total revenue receipts for 2006-07 are estimated at Rs. 23480.29 crores. This would comprise the State's own tax revenue of Rs. 10029.46 crores, Rs. 7015.17 crores as Central Tax Devolution, Rs. 2059.08 crores of State's non-tax revenue and Rs. 4376.48 crores of Central Grants. Compared to 2005-06, the State's own tax revenue is estimated to grow at 12.27 per cent, Mr. Raghavji informed the House.

The budget also shows an increase of Rs. 1140.07 crores in revenue expenditure. Compared to the revenue expenditure of Rs. 21369.90 crores in 2005-06, the expenditure is slated to touch Rs. 22509.97 crores during the next fiscal. The Minister said the Government did not resort to Ways and Means Advances for a single day in 2005-06.

The Finance Minister moved proposals for Rs. 503 crores to increase the power generation capacity, Rs. 344.20 crores for strengthening and upgrading of the transmission system and Rs. 260 crores for upgrading the sub-transmission system. The budget also provides for Rs. 429 crores for maintenance of roads and Rs. 265 crores for maintenance of public buildings.

There is a budgetary provision of Rs. 1908 crores for irrigation and Rs. 1800 crores for Sarva Shiksha Abhiyan, with emphasis on primary education.

To improve attendance and retention in schools, additional resources have been provided for the mid-day meals programme. The budget goes on to support girls' education on priority. Budgetary support would be given to provide free bicycles to all girl students admitted to Class IX who reside in villages that do not have high schools. Under this scheme, 79,000 girls will benefit in 2006-07.

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