Before Budget Session in Tripura Assembly, Pranajit speaks on State's fiscal condition
The budget session of the Tripura State Assembly is set to commence on July 7, according to Tripura's Finance, Planning, and Coordination Minister, Pranajit Singha Roy. During this session, the comprehensive budget for the fiscal year 2023-24 will be presented.
Following the assembly elections held on February 16 and the formation of the new government, the Tripura administration passed a vote-on-account for the initial four months of the current financial year (2023-24) in late March.
Singha Roy expressed confidence in the state's fiscal position, stating, "Our financial situation is robust. We are fulfilling committed expenditures while also allocating funds for major road and infrastructure projects. There is no significant financial crunch in any sector."
Meanwhile, a report titled "State Finances of North Eastern States," published by the Research and Information Division of the Lok Sabha Secretariat, highlighted that the financial condition of the northeastern states, including Tripura, is improving due to financial assistance from various central ministries.
However, the report also emphasized that certain steps are still necessary to maximize the effective utilization of financial assistance for the benefit of the people in these states.
The 15th Finance Commission (2021-26), led by N.K. Singh, had earlier recommended that the northeastern states increase their resources and revenue to strengthen their fiscal positions. Singh, a former member of the now-disbanded Planning Commission, highlighted in his report that each northeastern state possesses unique features and challenges and must accelerate their own resources and revenue for sustainable fiscal growth.
The report on State Finances of North Eastern States stated, "If we compare the population of the northeastern states with that of other Indian states, it is significantly less. With abundant resources and sensible utilization, these states can develop into sustainable and economically viable hubs for their people and for India as a whole."
Furthermore, the report noted that, compared to the northeastern states, other states in India pay higher taxes. This disparity arises from the exemption provided under Section 10 (26) of the Income Tax Act, which exempts members of Scheduled Tribes residing in specified areas of the northeastern states from paying taxes on income earned within those areas or states, including Arunachal Pradesh, Manipur, Mizoram, Nagaland, and Tripura.
Despite the northeastern region's population of 45.58 million people according to the 2011 census, which constitutes 8% of India's total geographical area but only 4% of the country's population, most of the states lack large and medium-scale industries, except for Assam. Experts attribute this to the underutilization of vast natural resources such as gas, oil, water, and forests in the hilly region, resulting in a limited revenue base for seven out of the eight northeastern states.
To enhance basic minimum services and infrastructure in the region, Central ministries and departments reserve 10% of their Gross Budgetary Support (GBS) for the central sector (CS) and centrally sponsored schemes (CSS), unless exempted.
Currently, the eight mountainous northeastern states, along with Himachal Pradesh, Jammu and Kashmir, and Uttarakhand, hold special category status and receive higher financial support from the central government.
According to budget estimates from 2014-15 to 2020-21, the actual expenditure in the northeastern region by non-exempted Central government ministries and departments amounted to Rs 2,65,766.67 crore. (Edited)
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