Karnataka Budget: SIDDU DOES IT AGAIN !!!

july1314siddubudget2Fortunately and with the grace of high command Mr.Siddaramaiah has presented the budget for the 10th time to the state of Karnataka. With the increasing internal rift within the party and external pressure, Mr.CM has made an honest effort to present a well-balanced budget. With the challenge of adverse effect in the computation of the GDP on the state of Karnataka and the “fund-cut’ by the Central Govt. to the populous schemes like JN-NURM, mid-day meal schemes etc, Mr.CM has made a reasonable effort to tackle the same. However there has been a wide range of critic that, the budget is emphasizing on a particular section of the society, huge burden of populous programme, lack of long-term vision and lack of infrastructural boost-up etc.


Primary and Secondary educational sector got an allocation of about 11% of total budget estimate.Mr.CM committed to providing basic amenities in the school such as toilet, shoes  and proper infrastructure for the students. Medical and health care sectors are also promised for growth. CM promised that full-fledged emergency ICU’s will be constructed at all district headquarters and dialysis facilities at all taluks. He has taken several initiatives to upgrade the living style and to manage the social equilibrium in the society by providing various welfare schemes to enhance education, skill development  to the neglected sections of the society. Further, for the first time in the state budget tourism has given prominence especially on and around the city of Mysore, Bangalore and the coastal Karnataka. He adopted bullish strategy for the development of Bangalore city.


It is quite clear that the budget is backed with AHINDA agenda, as nearly Rs.30,328 crores are exclusively parked for the welfare of these communities. Mr.CM has given more prominence to the regions of Old Mysore, Mumbai Karnataka and Bangalore, and other regions are consistently neglected. No major allocation is provided for irrigation in the backward districts of the state. Long standing demand for the permanent drinking water in the districts of Kolar, Chikkaballapur etc are not provided for. Building of Infrastructural facility outside Bangalore city, nowhere grabbed attention of the Chief Minister and the same may have a very severe effect on the economy of the state. Further, the BMRCL popularly known as “Namma Metro” is satisfied with the meager allocation of Rs.1,000 crores. It may be termed as the big disappointment for the people of Bangalore. Mr.CM adopted selective approach in providing additional grants to the local bodies. Surprisingly, the location for the construction of Indian Institute of Technology which was granted to the state in the recent union budget has not been announced.


The state of Karnataka is not having full-time Finance Minister since 2008, CM of the state is taking additional responsibility of the department of finance. The same has caused serious lacuna in the administrative efficiency of the department. Tax and other revenue collections have touched new lows in the last year and fiscal deficit within the state economy is rapidly rising. Government of Karnataka is ignoring the importance of Infrastructure in the state which may cause slow down of Industrial and Service Sector growth. The budget proposed to rise additional revenue from increasing tax on cigarettes and alcohols. However, the additional revenue so generated from the above sources are used only for the purpose of financing “Bhagyas” viz. populist schemes of CM. As per Economists, the huge burden of populist programmes is long-term burden to the financial condition of any state. Ironically the Govt. has taken no measures to reduce the seepage of subsidies and populist programmes. Out of Rs.1,42,534 crore of spending, the revenue expenditure (exp. On salaries, welfare schemes etc) accounts for Rs.1,16,360 crores  and the rest 25,564 crore is being spent for the betterment of the Infrastructure, Education, Transport etc. The above statistics clearly shows that the Govt. is spending more on populist schemes to woo the people instead of stabilizing the financial position of the state. As a result of all these the state is heading towards the debt trap. The investors are losing trust towards the state mechanism are started migrating towards the state of Seemandhra lead by the Investor Friendly CM Chandrababu Naidu. It’s a reminder for the state mechanism to be more realistic in the policy making and better execution of the budgetary provisions.

Adithya Baliga 


Cartoon by Raveesh Kemmai

Cartoon by Raveesh Kemmai

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