Uttarakhand Economic updates
Gross State Domestic Product (GSDP)
The Gross State Domestic Product (GSDP) of Uttarakhand for 2019-20 at current prices is estimated to be Rs 2,63,233 crore, which is 11% higher than the revised estimate for 2018-19.
Total expenditure for 2019-20 is estimated to be Rs 48,664 crore, a 12% increase over the revised estimate of 2018-19. In 2018-19, as per the revised figures, the expenditure is estimated to decrease by Rs 2,124 crore (4.7%) over the budgeted estimate.
Total receipts (excluding borrowings) for 2019-20 are estimated to be Rs 38,989 crore, an increase of 12.1% as compared to the revised estimate of 2018-19. In 2018-19, total receipts (excluding borrowings) are estimated to fall short of the budgeted estimate by Rs 906 crore (2.5%).
Revenue surplus for the next financial year is targeted at Rs 23 crore, or 0.01% of the GSDP. Fiscal deficit is targeted at Rs 6,798 crore (2.58% of GSDP).
Poor and marginal farmers will be provided with interest-free loans for agro-processing and agricultural activities.
This will be applicable for loans taken by farmers for an amount up to one lakh rupees. Loans taken by self-help groups up to five lakh rupees for agriculture related activities will also be eligible for the scheme. Rs 50 crore has been allocated for the scheme in 2019-20.
Improvement of children’s nutrition
Mukhyamantri Aanchal Amrit Yojana will be launched under which children between the age of three to six years will be provided milk twice in a week at anganwadi centres. Further, the Mukhyamantri Bal Poshan Yojana, which is provided to children suffering from severe malnourishment, will be extended to include other malnourished children as well.
Sankalp scheme will be launched for strengthening the skill development programmes and increasing the participation of women and weaker sections in these programmes. The scheme has been allocated Rs 4 crore in 2019-20. Strive scheme will be launched for strengthening the training institutes.
Growth in different Sectors
In 2017-18, the sectors of Agriculture, Manufacturing, and Services contributed to 11%, 49%, and 40% of the State Gross Value Added (GSVA). GSVA by a sector denotes the contribution of that sector to the state’s economy. In the same year, these sectors grew by 7.1%, 9.4%, and 13%, respectively.
Per capita GSDP
The per capita GSDP of Uttarakhand in 2017-18 (at current prices) was Rs 1,94,293. This is 10.1% higher than the figure for 2016-17 (Rs 1,76,544).
Capital expenditure for 2019-20 is proposed to be Rs 9,731 crore, which is an increase of 11.4% over the revised estimate of 2018-19. Capital expenditure includes expenditure affecting the assets and liabilities of the state, such as: (i) capital outlay, i.e. expenditure which leads to creation of assets (such as bridges and hospitals), and (ii) repayment and grant of loans by the state government.
Grants to Local Governments
The state government provides compensation and assignments to local bodies and Panchayati Raj institutions. In 2019-20, this amount is estimated to be Rs 2,183 crore (4.5% of the expenditure), a 18.8% increase over the revised estimate of 2018-19. Of this, Rs 1,157 crore has been allocated to urban local bodies, and Rs 1,026 crore to Panchayati Raj bodies.
Revenue expenditure for 2019-20 is proposed to be Rs 38,933 crore, which is 12.1% higher than the revised estimate of 2018-19. This expenditure includes payment of salaries, pensions, and interests, among others. Revenue expenditure forms 80% of the total expenditure proposed in 2019-20.
The total revenue receipts
Total revenue receipts for 2019-20 are estimated to be Rs 38,955 crore, an increase of 12.1% over the revised estimate of 2018-19. Of this, Rs 18,992 crore (49% of the revenue receipts) will be raised by the state through its own resources. Rs 19,964 crore (51% of the revenue receipts) will be devolved from the centre in the form of grants and the state’s share in central taxes. In 2019-20, own revenue and central transfers are expected to be 2.6% and 22.9% higher than the revised estimates of 2018-19, respectively.
In 2019-20, revenue from the state’s share in central taxes is estimated to increase by 10.9% over the revised estimate of 2018-19. Revenue in the form of grants-in-aid is estimated to increase by 34.6% (2,846 crore) in 2019-20 over the revised estimate of 2018-19. In 2018-19, grants-in-aid revenue is estimated to decrease by Rs 702 crore as per the revised figures (7.9% less than the budgeted estimate).
Uttarakhand has estimated to generate Rs 4,255 crore (11% of the revenue receipts) through non-tax sources in 2019-20. Non-tax sources include interest receipts, dividends, and royalties, among others. This is an increase of 13.6% over the revised estimate of 2018-19. In 2018-19, non-tax revenue is estimated to increase by Rs 276 crore at the revised stage (8% more than the budgeted estimate).
It is the excess of revenue expenditure over revenue receipts. A revenue deficit implies that the government needs to borrow in order to finance its expenses which do not create capital assets. The budget estimates a revenue surplus of Rs 23 crore (or 0.01% of GSDP) in 2019-20. This implies that revenue receipts are expected to be higher than the revenue expenditure, resulting in a surplus. The estimate indicates that the state is within the target of eliminating revenue deficit, prescribed by the 14th Finance Commission. The state has estimated a revenue surplus for the period 2018-19 to 2021-22.
It is the excess of total expenditure over total receipts. This gap is filled by borrowings by the state government, and leads to an increase in total liabilities. In 2019-20, fiscal deficit is estimated to be Rs 6,798 crore, which is 2.58% of the GSDP. The estimate is under the 3% limit prescribed by the 14th Finance Commission. Fiscal deficit in 2017-18 at 3.58% of GSDP was higher than this 3% limit.