Tax-free deficit budget presented in Tamil Nadu

Chennai: Tamil Nadu Finance Minister D. Jayakumar on Thursday presented a tax free but a revenue deficit budget for fiscal 2017-18. This is the first budget of the government headed by Chief Minister K. Palaniswami.

Presenting his first budget, Jayakumar said the total revenue receipts was projected at Rs 159,363 crore and the revenue expenditure was projected at Rs 175,293 crore, leaving a revenue deficit of Rs 15,930 crore.

Jayakumar said the state government will replace the State Planning Commission with the State Development Policy Council to advise the government on policy coherence and formulation of programmes.

He said the government will set up a world class "Tamil Cultural Heritage Museum" at World Tamil Sangam, Madurai, to showcase the rich cultural heritage of the Tamil people.

Jayakumar said in order to bring more cropped area under the Pradhan Mantri Fasal Bima Yojana (PMFBY), the government has provided Rs 522.70 crore towards premium subsidy for the next fiscal.

He said Tamil Nadu had joined the Indian government's Ujwal Discom Assurance Yojana (UDAY).

Out of Rs 30,420 crore of debt of the Tamil Nadu Generation and Distribution Corp (TANGEDCO), the state government has taken over 75 per cent of this debt and bonds were being floated in the open market to repay the debt.

The remaining 25 per cent of the loans considered under the scheme will be converted into power bonds by TANGEDCO.

Due to this debt takeover, TANGEDCO will get interest savings of Rs 2,882 crore per annum and savings of Rs 2,282 crore in principal repayment per annum as these liabilities shift to the state government.

The implementation of UDAY scheme is resulting in an interest saving of Rs 1,335 crore per annum for the state and TANGEDCO together.UDAY scheme is resulting in an interest saving of Rs 1,335 crore per annum for the state and TANGEDCO together.

In order to develop coastal tourism circuits, Chennai, Mamallapuram, Rameswaram, Manapadu and Kanniyakumari will be developed under the Swadesh Darshan Scheme at a cost of Rs 100 crore in 2017-18. 

Jayakumar said for industrial development in the state, the government will undertake the second phase of the Tamil Nadu Investment Promotion Programme (TNIPP) with JICA assistance at an estimated project cost of Rs 1,295 crore from 2017-18.

Besides improving the policy environment to make the state investor-friendly, the scheme will further strengthen infrastructure for industrial development.

Jayakumar said the next Global Investors Meet will be held during 2017-2018 to attract further industrial investment and Rs 75 crore has been provided for this purpose in the budget.

The budget increased the sum insured to Rs 200,000 under the state government insurance scheme.

Jayakumar said the government was looking at ways to increase state revenue as the closure of state owned liquor outlets resulted in reduced sales tax revenue.

He said the expenditure trend was steady except for hike in salaries and pensions.