The Finance Minister, Harpal Cheema, is likely to present a Budget that will expand Aam Aadmi Clinics, build schools of eminence, and promote horticulture crops. A push to sericulture and fisheries is also expected in the Budget.
Though the government is unlikely to announce its rollout of Rs 1,000 for women in the Budget proposals - a pre-poll promise by the party- some amount may be reserved for the same.
The upcoming fiscal year is expected to be a tightrope walk for the government of Punjab as it seeks to roll out several schemes amid depleting revenue receipts. The Budget session, which is scheduled to begin on March 4 will bring into focus the state of finances after the end of GST compensation given by the Centre since 2017, and the impact of the Aam Aadmi Party's rollout of 300 units of free power to domestic consumers. It will also reveal the government's plans to unveil new schemes in agriculture, health, and education and how it proposes to fund these schemes.
The government is facing the challenge of ensuring a regular stream of revenue through its own tax resources and non-tax resources, as it will not receive any GST compensation this year, which was around Rs 17,000 crore. The government is likely to up its borrowings to the maximum limit of 3% of the Gross State Domestic Product to compensate for this loss of revenue. Although this will add to the state's burgeoning debt burden, the government wants to create a feel-good factor in the state in its first full budget.
According to sources, the Finance Department's biggest concern is ensuring a regular stream of revenue. The government's expenditure on salaries, pensions, and subsidies is expected to increase by over Rs 2,000 crore, and expenditure on payment of subsidy will cross Rs 20,000 crore. The government is also bound by a court order to pay the pending dues of dearness allowance to its employees. With the expenditure increasing, the government will have to go in for maximum allowed market borrowings in the next fiscal.
The state government's capex spending is also a cause for concern. Against a targeted Rs 10,981.09 crore for 2022-23, the expenditure so far has been just Rs 3,751.14 crore. The capex is the money spent on building assets and investments made by the government. Therefore, the government may push for capital building in the Budget to increase capex spending. Punjab was among the top five GST compensation receiving states in the country.
A report released in January this year by the Reserve Bank of India had revealed that the state will be among the states like Puducherry, Delhi, Himachal Pradesh, Goa, and Uttarakhand to be most adversely affected by the end of the GST compensation regime. The Finance Minister is expected to present a Budget that promotes horticulture crops, sericulture, and fisheries.
The government's primary concern is ensuring a regular stream of revenue as it will not receive any GST compensation this year. The government may push for capital building in the Budget to increase capex spending, which has been lower than targeted. The state's expenditure on salaries, pensions, and subsidies is expected to increase, and it has to pay the pending dues of dearness allowance to its employees.
