Bhubaneswar: Even as the Covid-19 Pandemic has adversely impacted the economy of various States in the country, Odisha’s Naveen Patnaik led Government however, has been able to steer State’s economy quite well by keeping the negative fiscal deficit in first quarter of the current financial year, said a Ecoscope report published by Motilal Oswal Institutional Equities.
The Naveen Patnaik Government once again has exhibited its excellent financial management skill much better than its peer States like Kerela, Andhra Pradesh and Telangana which are considered as more developed States.
The fiscal deficit of many States have soared to more than double in the first quarter of the current fiscal amid the coronavirus-led revenue loss.
While the fiscal deficit of States was as high as 18.4 per cent of the budget estimates in first quarter of previous FY, the fiscal deficit has gone up to 36.5 per cent of BE in Q1 in current FY, which was more than double of that in the previous years, said the Ecoscope report.
While the fiscal deficit was around 70 per cent of BE in Kerala and Andhra Pradesh in the first quarter and more than 50 per cent of BE in Telangana. In contrast, Jharkhand, Himachal Pradesh, Odisha, and Uttarakhand posted a fiscal surplus in the same period.
The fiscal deficit rose on the back of a severe fall in revenue as the spendings were subdued. The monthly accounts available for 14 States — together accounting for nearly 63 per cent of all States — showed that the total receipts of the states fell 18.2 per cent on-year in Q1 FY21, while total spending grew by just 2.7 per cent on-year in the quarter.
While the grants from the central government supported the states’ finances up to a limit, the states’ total tax receipts (including center’s devolution) fell 32.1 per cent and non-tax revenue receipts fell 27 per cent on-year in the first quarter of FY21. The collection of stamp duties and registration charges also shrank 58 per cent in the same period, the Ecoscope report showed.
It may be noteworthy to mentioned that the Odisha Government has announced strict austerity measures in view of pandemic and keeping fiscal deficit in control.
The Biju Janata Dal Government has received investment proposals worth Rs 12,000 crore during the coronavirus pandemic.
Of the total investments made in the country in the last six months, Odisha accounted 18 per cent of the total investment. Odisha also a leading state in providing business eco system for the startup companies.
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