Union budget: India
(→See also) |
(→Budget transparency) |
||
| Line 19: | Line 19: | ||
An international report on budget transparen cy places India at a middling level globally and next only to Bangladesh in South Asia. The report, which looks at 2013-14, the last year of the UPA, gave India a score of 46 on 100, just slightly better than the average of 45 for all the countries surveyed. | An international report on budget transparen cy places India at a middling level globally and next only to Bangladesh in South Asia. The report, which looks at 2013-14, the last year of the UPA, gave India a score of 46 on 100, just slightly better than the average of 45 for all the countries surveyed. | ||
| + | |||
The report, Open Budget Survey 2015, brought out by the International Budget Partnership, evaluates countries on the transparency of their budgeting process on several counts under three major heads public participation, oversight by the legislature and oversight by audit. India scores an impressive 75 on 100 in oversight by audit, but performs poorly on the other two counts. In particular, on public participation, India's score was a mere 19 on 100. | The report, Open Budget Survey 2015, brought out by the International Budget Partnership, evaluates countries on the transparency of their budgeting process on several counts under three major heads public participation, oversight by the legislature and oversight by audit. India scores an impressive 75 on 100 in oversight by audit, but performs poorly on the other two counts. In particular, on public participation, India's score was a mere 19 on 100. | ||
| Line 32: | Line 33: | ||
The research for the survey was done by 102 research and civil society organisations working around the world. The organisation doing the research for India was the Centre for Budget and Governance Accountability (CBGA), an NGO advocating greater transparency and accountability in budget making in India. | The research for the survey was done by 102 research and civil society organisations working around the world. The organisation doing the research for India was the Centre for Budget and Governance Accountability (CBGA), an NGO advocating greater transparency and accountability in budget making in India. | ||
| + | |||
| + | = Government revenues, expenditure= | ||
| + | ==2012-17== | ||
| + | [http://epaperbeta.timesofindia.com/Article.aspx?eid=31808&articlexml=Spending-by-states-grows-at-slowest-pace-in-29052017017062 Sidhartha, Spending by states grows at slowest pace in 13 years, May 29, 2017: The Times of India] | ||
| + | |||
| + | [[File: Share of centre's revenues between states and centre, 2012-18, year-wise and capital spending, 1993-2018 and combined spending, 1994-2018.jpg|Share of centre's revenues between states and centre, 2012-18, year-wise and capital spending, 1993-2018 and combined spending, 1994-2018; [http://epaperbeta.timesofindia.com/Article.aspx?eid=31808&articlexml=Spending-by-states-grows-at-slowest-pace-in-29052017017062 Sidhartha, Spending by states grows at slowest pace in 13 years, May 29, 2017: The Times of India]|frame|500px]] | ||
| + | |||
| + | '''Most Budget For 11% Increase In FY18 Against 19% in FY17''' | ||
| + | |||
| + | Amid low spending by the private sector, some of the top states in the country have slowed down spending due to their inability to increase the tax base. | ||
| + | |||
| + | During the current finan cial year, 17 major states have budgeted for a 10.8% rise in spending, compared with 19% last year, making this the slowest pace of increase in at least 13 years. As a result, general government spending is expected to grow 7.8% this year, less than half the 17% rise recorded last year, a study by Motilal Oswal economist Nikhil Gupta showed. | ||
| + | |||
| + | But the good news is that at 7.8%, the pace of increase in revenue spending is lower than capital spending, which creates assets and generates jobs. Capital expenditure is projected to rise by14%, faster this year than the long-term average growth of around 12%. Given that nearly 84% of states' budgets goes toward revenue spending, such as interest payments, there is very little left to undertake productive spending. | ||
| + | |||
| + | Devendra K Pant, chief economist at India Ratings, said, “Indian states are providing support to investment growth.The subdued investment is pos sible only because of the capital spending by the states. After the 14th finance commission award, the general apprehension was that states would spend on current consumption.On the contrary , the states have spent more on capital expenditure. On average, states spent 60% of their capex on building roads and bridges, power, and irrigation.“ | ||
| + | |||
| + | This year too, the highest share of allocation is towards irrigation and flood control (23%), followed by transport (19%) and energy (8%). Of the overall revenue spending, education (18%) tops the list, followed by interest payments (12%) and pension (11%). | ||
| + | |||
| + | But the real worry is inability of states to increase the share of own tax revenue. States raise resources from four key areas -own taxes, nontax receipts, share of central taxes and grants from the Centre. Although tax collections are budgeted to grow over 14%, the highest in five years, as percentage of GDP it remains a modest 6.5%. | ||
| + | |||
| + | States are increasingly relying more on the Centre to meet their funding needs as the growth in states' own receipts has significantly lagged the rise in support from the Centre, which comes in the form of tax transfers and grants. While Centre's support has increased by nearly 30% in the past three years, states' own resources grew by only 10% per annum between 2013-14 and 2016-17, the report said. | ||
| + | |||
| + | Just three years ago, support from Centre was estimated at around 60% of states' own tax receipts, but now they are nearly equal following the recommendations of the last finance commission. | ||
= Financial year= | = Financial year= | ||
Revision as of 18:22, 29 June 2017
This is a collection of articles archived for the excellence of their content. |
Contents |
Budget transparency
2013-14
The Times of India, Sep 10 2015
India's budget transparency score worse than Bangladesh's
NZ tops list, China lowest among BRICS
An international report on budget transparen cy places India at a middling level globally and next only to Bangladesh in South Asia. The report, which looks at 2013-14, the last year of the UPA, gave India a score of 46 on 100, just slightly better than the average of 45 for all the countries surveyed.
The report, Open Budget Survey 2015, brought out by the International Budget Partnership, evaluates countries on the transparency of their budgeting process on several counts under three major heads public participation, oversight by the legislature and oversight by audit. India scores an impressive 75 on 100 in oversight by audit, but performs poorly on the other two counts. In particular, on public participation, India's score was a mere 19 on 100.
On top of the list was New Zealand with a score of 88.Sweden, South Africa, Norway and the US all scored in the eighties. Among the BRICS nations, apart from South Africa, Brazil with 77 and Russia with 73 had scores well above India's, but China with a score of just 14 was judged to have among the least transparent budget processes.
India's score is a significant dip from the 62 it scored in an earlier round of the same survey in 2012. However, the sharp drop is largely on account of temporary factors like the mid-year review and the year-end report not being presented in time.
These delays could be attributed to changes in personnel (like Raghuram Rajan moving from the chief economic advisor's job to head the RBI and his replacement taking time), which is why they are seen as a temporary regression.
The report does make the point, though, that while the regressions may be temporary and the rebound from them quick, they highlight what can happen “when the mechanics of publishing documents on time are not sufficiently institutionalized“.
Had India retained its score of 62 it would have been among the better countries globally and comfortably led in South Asia.
The research for the survey was done by 102 research and civil society organisations working around the world. The organisation doing the research for India was the Centre for Budget and Governance Accountability (CBGA), an NGO advocating greater transparency and accountability in budget making in India.
Government revenues, expenditure
2012-17
Sidhartha, Spending by states grows at slowest pace in 13 years, May 29, 2017: The Times of India
Most Budget For 11% Increase In FY18 Against 19% in FY17
Amid low spending by the private sector, some of the top states in the country have slowed down spending due to their inability to increase the tax base.
During the current finan cial year, 17 major states have budgeted for a 10.8% rise in spending, compared with 19% last year, making this the slowest pace of increase in at least 13 years. As a result, general government spending is expected to grow 7.8% this year, less than half the 17% rise recorded last year, a study by Motilal Oswal economist Nikhil Gupta showed.
But the good news is that at 7.8%, the pace of increase in revenue spending is lower than capital spending, which creates assets and generates jobs. Capital expenditure is projected to rise by14%, faster this year than the long-term average growth of around 12%. Given that nearly 84% of states' budgets goes toward revenue spending, such as interest payments, there is very little left to undertake productive spending.
Devendra K Pant, chief economist at India Ratings, said, “Indian states are providing support to investment growth.The subdued investment is pos sible only because of the capital spending by the states. After the 14th finance commission award, the general apprehension was that states would spend on current consumption.On the contrary , the states have spent more on capital expenditure. On average, states spent 60% of their capex on building roads and bridges, power, and irrigation.“
This year too, the highest share of allocation is towards irrigation and flood control (23%), followed by transport (19%) and energy (8%). Of the overall revenue spending, education (18%) tops the list, followed by interest payments (12%) and pension (11%).
But the real worry is inability of states to increase the share of own tax revenue. States raise resources from four key areas -own taxes, nontax receipts, share of central taxes and grants from the Centre. Although tax collections are budgeted to grow over 14%, the highest in five years, as percentage of GDP it remains a modest 6.5%.
States are increasingly relying more on the Centre to meet their funding needs as the growth in states' own receipts has significantly lagged the rise in support from the Centre, which comes in the form of tax transfers and grants. While Centre's support has increased by nearly 30% in the past three years, states' own resources grew by only 10% per annum between 2013-14 and 2016-17, the report said.
Just three years ago, support from Centre was estimated at around 60% of states' own tax receipts, but now they are nearly equal following the recommendations of the last finance commission.
Financial year
2017: MP first state to go for Jan-Dec
MP first state to go for Jan-Dec fiscal, May 3, 2017: The Times of India
The Narendra Modi government is still mulling shifting the financial year from April-March to January-December, but Madhya Pradesh has already announced a merger of the fiscal and calendar years.
“The state cabinet has decided to change the financial year to January-December from April-March. The state budget will be tabled in December-January while financial closure will be done in December every year,“ state le gislative affairs and public relations minister Narottam Mishra told reporters after Tuesday's cabinet meeting.
The minister did not elaborate how the government would go about it especially when the Centre would be on a different schedule. He said the MP government would “try to finish the current budget proceedings by December this year“. “The next budget will be presented in December this year, or in January 2018,“ he added.
