Maharashtra mulls White Paper on finances

State finance minister says the new govt will take a slew of measures to revive economy

The Bharatiya Janata Party (BJP) government in Maharashtra proposes to bring out a White Paper on the state’s finance situation. The triggers for the move include: the spiralling public debt, which is now at Rs 3.15-lakh crore; revenue deficit has ballooned from Rs 4,100 crore estimated in Budget 2014-15 to Rs 26,000 crore, owing to the sops offered by the previous Congress-Nationalist Congress Party (NCP) government in the run-up to the Assembly polls; and the annual subsidy burden on account of providing relief in industrial power tariff and implementation of food security scheme stands at Rs 12,000 crore.

Besides, the new government will have to raise as much as Rs 52,000 crore to implement several decisions taken by the Congress-NCP government in the run-up to the just-concluded Assembly elections.

State finance minister Sudhir Mungantiwar told Business Standard: “The finance department made a comprehensive presentation to the state Cabinet on Saturday on the present status of finances and the challenges to revive the economy. The government plans to prepare a white paper. The focus will be where the loan, which was raised by the previous government, has been spent. The new government will initiate action for not putting the money for its proper use, notwithstanding his or her position.” He claimed that prima facie, it looks that money has not been properly spent.

Mungantiwar, however, declined to divulge more details saying that he would need to hold a series of meetings with the finance department to take various measures to boost economic growth and curb deficit.

A finance department official said the new government faces a burden of Rs 10,000 crore waiver of dues on electricity to farmers given by Congress-NCP government. Besides, the government will have to shell out Rs 706 crore a month towards subsidy for relief in industrial power tariff.

This goes directly to the state-run Maharashtra State Electricity Distribution Company. “Further reduction in industrial power tariff, as assured by the BJP during the poll campaign, may further increase burden on state exchequer,” the official added.

Further, the government will have to give a fresh look at the Rs 1,500 crore subsidy given to the state transport department and another Rs 4,000 crore towards a number of industrial promotion schemes.