Fadnavis will have to hardsell Maharashtra at Davos meet

Despite investor friendly sops, state's deteriorating finances considered major worry

Amid rising revenue deficit and pressure on state finances, Chief Minister Devendra Fadnavis will have to hardsell Maharashtra at the World Economic Forum (WEF)’s annual meeting at Davos. Besides Fadnavis, Union Finance Minister Arun Jaitley and Andhra Pradesh Chief Minister N Chandrababu Naidu are also taking part in the meeting.

The Bharatiya Janata Party (BJP) state unit has hailed the selection of Fadnavis for the crucial WEF conclave, saying that he has been handpicked by none other than Prime Minister Narendra Modi. However, government sources say Fadnavis has an uphill task to project Maharashtra's pre-eminence in attracting investments, despite burgeoning competition from other states.

Maharashtra's revenue deficit has risen sharply to Rs 26,000 crore from Rs 4,500 crore in March last year. The revenue deficit is expected to surge at     Rs 40,000 crore by end of March 2015, as the government has announced relief and rehabilitation packages to help farmers affected by various natural calamities. Despite repeated requests, the Centre has yet to release Rs 4,500 crore demanded by the state government.

UPHILL TASK FOR A PROJECTION

• Sources say Fadnavis has an uphill task to project Maharashtra's pre-eminence in attracting investments
• State's revenue deficit has risen sharply to Rs 26,000 cr from Rs 4,500 cr in March last year  
• The revenue deficit is expected to surge at Rs 40,000 cr by end of March 2015, as the govt has announced relief and rehabilitation packages to help farmers
• The chief minister had recently admitted that the government might have to raise loan to pay wages, salaries and pension of its two million employees

The BJP-Shiv Sena government has imposed 40 per cent cut in plan expenditure due to the paucity of funds.

Further, the chief minister recently admitted that the government might have to raise loan to pay wages, salaries and pension of its two million employees. The wage bill for the current fiscal is estimated at Rs 85,000 crore.

Economist Bhalchandra Mungekar told Business Standard:  ''Fadnavis as the chief minister will have to struggle hard to convince the international investors to invest in the state and also assure that he will create financial, physical and administrative infrastructure conducive for foreign investments.''

A senior BJP minister however, said the government had taken a slew of decisions, including reduction in number of approvals and permission to 25 from 76 required for an investor in the state.

Besides, the government has released draft for its new information and ITES policy by proposing host of sops. Industries minister Subhash Desai has announced that development of clusters in textile, manufacturing, engineering and other sectors.