Mere Populist or Productive?

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Will Parrikar stick to former chief minister Digambar Kamat’s plan to present Action Taken Report of every budget to analyse the budget performance and fulfillments of announcements? Because that would tell us what is being actually achieved.

Budget is not a mere financial exercise of how Rupee comes in and how it goes out.  It needs to reflect the mindset of any government – politically, ideologically and philosophically. Any budget thus needs to be analysed financially as well as philosophically.

Chief minister Manohar Parrikar is one of the best financial manager Goa has ever found till date. When he became the chief minister for the first time in 2000, he changed the whole facet of the state budget. In fact, for the first time in Goa’s history, his financial action proved beyond doubt that Goa does not need to beg to the central government for special favours, like Special Status etc. We have enough to generate revenue, provided we manage it skillfully.

The same financial expertise of Parrikar reflects also in this year’s budget, in spite of preparing the budget within a fortnight. Besides raising huge tax revenue, he has also once again focused upon non-tax revenue. He might have lost around Rs 150 crore by eliminating VAT on petrol to make it cheaper by Rs 11, but the revenue raised through VAT, entertainment tax, entry tax and luxury tax is almost Rs 470 crore. He has even generated almost Rs 129 crore with little rise of two paise per unit in power tariff.

While fulfilling the populist election promises, the state is losing over Rs 700 crore on petrol, LPG gas, Ladli Laxmi scheme, unemployment allowance, housewife allowance, laptops and tablets to Std V and VI students and increased amount to the beneficiaries of Dayanand Samajik Suraksha Yojana. But he has managed to match it with revenue generation through VAT, excise, power, casino fees and even stamps and registration fees.

But Parrikar appears little overconfident when he targets 15 per cent growth rate, almost double from the present growth rate of 8.30 per cent. He has planned for 12 per cent growth rate in the budget. Shocking however is the six per cent growth rate in agro sector he is envisaging, when it has actually slipped to mere 1.77 per cent in 2010-11 from 3.20 per cent in 2009-10.

It appears boasting. Because the budget does not provide anything that great to pull up the agro economy within a year. He plans to make Goa self-sufficient in milk and vegetables. Yes, he has made good plans to increase milk production. But employing 10,000 youth in milk production in four years appears overambitious. That too when he has offered Rs 3000 to 4500 under Minimum Employment Assurance Scheme to the unemployed youth, for not working. Secondly, there is absolutely nothing offered to increase vegetable production, except more Horticulture outlets.

Will he stick to former chief minister Digambar Kamat’s plan to present Action Taken Report of every budget to analyse the budget performance and fulfillments of announcements? Because that would tell us what is being actually achieved.

Distributing doles is not an achievement. It could backfire if it does not translate into increased productivity of human resource. Allowances to housewives and unemployed can make them more dependent on the government rather than making them independent. Schemes like laptops to students from Std V is an excellent idea, but fruitless if it is not combined with new education pattern. In fact reviewing the productive output of such schemes for Std XI students as well as teachers is a necessity, before extending it to almost all the students.

The mindset also reflects in reducing the entry fee on casinos from Rs 2000 to Rs 500, while preventing entry to local youth on Casinos. He rationalized the entry fee because the casino operators were cheating. If this cheating could not be managed, how will he manage to prevent local youth from entering?

Parrikar thus now needs to spell out his philosophy. Is he interested only in making everybody happy with all kind of comforts through schemes and allowances or ultimately interested in taking the standard of human resource at a much higher level? If not, all the best efforts of Parrikar would simply go in vain.

Because the country today is talking about demographic dividend. Pleasing exercise should not result into demographic liability…