Kerala budget focuses on infrastructure development, jobs

By: |
January 16, 2021 12:15 AM

Finance Minister Thomas Isaac said Kerala is implementing the biggest state-level anti-recession infrastructure package in India of Rs 60,000 crore using KIIFB funds.

While criticising the Centre’s farm laws, Isaac increased the base price of natural rubber to Rs 170 per kg,procurement price of paddy to Rs 28 per kg and coconut to Rs 32 per kg.While criticising the Centre’s farm laws, Isaac increased the base price of natural rubber to Rs 170 per kg,procurement price of paddy to Rs 28 per kg and coconut to Rs 32 per kg.

Increasing welfare pensions, creating jobs and a thrust given to infrastructure development were the highlights of the election-year budget presented by Kerala Finance Minister Thomas Isaac on Friday. While the fiscal deficit for FY21 has been revised to 4.25% of gross state domestic product against 3% originally budgeted due to a sharp dip in revenue attributable to the pandemic, Isasc has set a target to bring it down to 3.5% for the next fiscal.

He said that the medium-term fiscal policy document envisages the state’s GST collections to pick up, boosting revenue prospects.

Kerala’s economy in terms of Gross State Value Added (GSVA) is estimated to have shrunk by 26% in the first quarter of 2020-21 due to the crisis caused by the Covid-19 pandemic and the consequent lockdown, according to the Economic Review 2020.

The budget revenue is seen to decline by 18.77 % in FY21 from the initial Budget Estimate, while only a marginal decline is expected in revenue expenditure, as welfare spending has been kept close to the budgeted level.

Faced with the difficult task of reviving the economy from the impact of the pandemic, the minister has opted for mobilising resources outside the budget through the Kerala Infrastructure Investment Fund Board (KIIFB).

He said that Kerala is implementing the biggest state level anti-recession infrastructure package in India of Rs 60,000 crore using KIIFB funds. In 2021-22, projects worth Rs 15,000 crore will be completed through KIIFB.

He criticised the Centre for not providing the deserved funds to states.

Continuing the focus on social security, he has raised the welfare pension to Rs 1,600 with effect from April 1,2021. Honorarium for ASHA workers and elected local body representatives has been hiked by Rs 1,000, welfare fund contribution of NRK returnees hiked by Rs 200, a new social welfare board will be created for employees in the tourism sector and pension of journalists and non-journalists increased by Rs 1,000.

While criticising the Centre’s farm laws, Isaac increased the base price of natural rubber to Rs 170 per kg,procurement price of paddy to Rs 28 per kg and coconut to Rs 32 per kg.

Job creation is major focus of the budget with Isaac saying that eight lakh job opportunities is to be created in the coming fiscal.The budget has allocated Rs 20 crore to create workstation facilities for work near home initiatives and plans to create jobs for 20 lakh people through digital platforms.

Isaac announced Rs 150 crore for digitalising classrooms in colleges. He said that all families in Kerala should have laptops and declared that the marginalised sections will get laptops for half price. Isaac said that K-FON project that will provide internet to all houses, will be completed by July 2021.

Isaac said that the budget for 2021-22 will add a new chapter to the Kerala development model that will focus on creating employment opportunities from knowledge-intensive industries while consolidating the achievements in the social sector.

Do you know What is Cash Reserve Ratio (CRR), Finance Bill, Fiscal Policy in India, Expenditure Budget, Customs Duty? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1CEA expects food inflation to ease with unlock, good monsoon
2Bank of England keeps UK rates at record low of 0.1%
3States’ revenues set to cross pre-pandemic level this fiscal: Report