Uddhav Thackeray's big test as Maharashtra CM: Finding money for farmers

Maharashtra Chief Minister Uddhav Thackeray faces his first big test when he heads to Nagpur for the winter session of state legislature beginning December 16. A combative Bharatiya Janata Party (BJP) will be prepared to question Thackeray over his promises of loan waiver and relief to farmers.

Thackeray did not make big-ticket announcements in his first week as chief minister. But his move to review all decisions taken by his predecessor, Devendra Fadnavis, preparing a white paper on state finances, and withdrawal of police cases against various activists will likely help him widen his support base, firm his grip over administration, and target the BJP.

The bigger challenge for the Maha Vikas Aghadi (MVA, the coalition of the Shiv Sena, the Congress, and the Nationalist Congress Party), however, is to deliver on the common minimum programme, which assures loan waiver for farmers, reservation of jobs for locals in the private sector, and Rs 1 health clinics, among other things.

Thackeray led the Shiv Sena on a populist and pro-farmer plank before joining hands to form the government with the Congress and the NCP. How soon he implements the MVA’s agenda depends on the state’s ability to mop up funds. His six new ministers are without portfolios a even week after their swearing-in, and cabinet expansion, too, is on hold until after the winter session.

The new government will have to factor in the economic slowdown and the dip in tax collection before committing the state’s finances to various projects. It will prioritise projects, depending on the availability of funds, Thackeray has said.

The state government's debt swelled from Rs 2.9 trillion in 2014 to Rs 4.7 trillion now as farm loan waivers and the implementation of the 7th Pay Commission recommendations put a strain on the Budget. Additionally, the government has guaranteed loans of over Rs 40,000 crore to state undertakings and corporations. Yet Maharashtra's debt to gross state domestic product ratio (excluding borrowings by corporations) remains well under the cap set by the Finance Commission.

“The government needs to spend more on irrigation. The percentage of irrigated land in Maharashtra is well below the national average,” said former chief minister and Congress MLA Prithviraj Chavan.

The government is already under pressure to scuttle Prime Minister Narendra Modi’s pet bullet train project and devote more resources to support farmers. “We are reviewing which projects are important for the state’s development and whether projects like the bullet train can be taken at a later stage,” NCP leader and minister Jayant Patil told a TV channel.

“Our priority is addressing farmer issues,” said minister and Sena leader Eknath Shinde after a Cabinet meeting last week. The Cabinet discussed issues related to farm loan waiver and withdrawing police cases against farmers who participated in agitations. A team of state agriculture and co-operation department officials visited Jaipur to study the Rajasthan government's loan waiver scheme. One estimate puts the cost of fresh loan waiver at over Rs 30,000 crore.

 “The real estate and auto sectors are witnessing a slowdown and there is a fall in car registrations and stamp duty collections. Raising funds to support farmers will be a challenge,” said Congress MLC Anant Gadgil.

 Chavan believes that key decisions will take place only after the Cabinet expansion. While the Shiv Sena and the Congress have been keen on the Cabinet expansion, it is said to have been deferred on the insistence of NCP chief Sharad Pawar. Ajit Pawar is tipped for deputy chief minister's post and has support among party MLAs, but giving him the post now could be seen as a reward for his rebellion. “Pawar saheb wants to avoid any sign of unease within the party during the legislative session and hence expansion is postponed,” said a party functionary.

MVA leaders are also be working on a strategy to take on the BJP during the winter session. That the BJP will not let the new government breathe easy was evident during the confidence motion earlier this month. Fadnavis accused the Thackeray-led government of violating procedure during swearing-in of ministers and selection of pro tem speaker. He also raised the issue of agrarian package reminding Thackeray of his demand of giving Rs 25,000 per hectare to flood-hit farmers.

"The BJP will try to raise issues against the government during the winter session but will respond to them confidently," said Nagpur MLA and minister Nitin Raut.