Cash-Starved Punjab is pinning high hopes on the Centre to cover 50% of additional expenditure to implement the Sixth Pay Commission’s recommendations during 2009-10. The state is expecting a grant of Rs 1,500 crore for the pay revision. However, newly-appointed Chief Secretary SC Aggarwal has already chalked out alternative ways to generate funds for executing the pay panel’s recommendations, which will cause an annual burden of Rs 3,000 crore on the state. The payment of arrears would cost another Rs 4,800 crore.
Without disclosing the details on how to generate funds to meet the burden of pay revision, the CS told FE that the economic slowdown has further squeezed the finances in the state by causing a loss of Rs 3,000 crore in less than a year. However, he was hopeful of a recovery by the end of the year.
“We have made certain requests to the Centre to introduce special incentives to push industrial growth in the state. The state’s industrial scenario worsened due to tax holiday offered to neighbouring states. We have sought help from the Centre to create an investment-friendly environment in Punjab,” he added.
Aggarwal said the battle of providing more concessions to the Rs 18,919-crore oil refinery project at Bathinda, co-owned by steel tycoon LN Mittal and state-owned oil giant HPCL, would be resolved soon. Aggarwal said the state government would also pay a subsidy of Rs 150 crore to industries in the state shortly.