West Bengal budget for FY22 provides thrust to social-sector spend, Covid-19 relief

The West Bengal government’s budget for FY22 tabled by chief minister Mamata Banerjee in the state assembly on Wednesday laid emphasis on social-sector expenditure and Covid reliefs. The size of the budget for the next financial year has been pegged at Rs 2,78,727 crore, up 28.5% over the FY21 level (RE).

Outlays for key schemes like Krishak Bandhu, students’ credit card and Lakhi Bandhu ( basic income for women) schemes have been enhanced significantly. Allocations have also been increased for food and civil supplies and Covid relief.

Revenue receipts have been estimated at Rs 1,86,661 crore, while revenue expenditure has been budgeted at Rs 2,13,436 crore. Fiscal deficit for FY22 has been pegged at 4% of Gross State Domestic Product (GSDP) and revenue deficit at 1.77% of GSDP.

West Bengal’s GSDP grew 1.2% in FY21 against a negative growth of 7.7% in India’s GDP. Fiscal deficit as a percentage of GSDP was 3.86%, revenue deficit 2.54% and debt to GDP was 35.54% for West Bengal in FY21 against the national fiscal deficit of 9.3%, revenue deficit of 7.5% and debt to GDP of 62.22% in the same year, Banerjee said.

Banerjee said West Bengal outperformed the Centre in these parameters despite a decrease in tax devolution of Rs 14,225 crore in FY 21. The state was supposed to receive Rs 58,952 crore as devolution from the Centre but received Rs 44,737 crore in FY21, Banerjee said adding, the state had got Rs 11,000 crore less as devolution in FY20.

Finance minister Amit Mitra, clarifying the reason for a positive economic growth despite the Covid situation said the state’s schemes directed towards the social sector development gave a stimulus to demand and this year’s spending for various social schemes would be 85% of the ‘planned expenditure.’

The capital expenditure for the FY22 has been pegged at above Rs 65,291 crore. GST compensation is overdue for two years, Mitra added.

The budget, in view of the Covid situation, has extended the motor vehicle tax and additional tax exemption upto December 31 this year, which was earlier given up to June 30 in the vote on account presented before the state assembly elections. The budget has also announced a 10% decrease in the circle rate for registration of land and property deeds up to October 30.

Banerjee said that there has been more than Rs 1,000 crore investment in West Bengal’s IT sector in the last one year and Rs 73,000 crore investment in the industrial cluster at Raghunathpur. The Deocha Pachami coal block will give the state a benefit of Rs 20,000 crore from December onwards this year.

The Krishak Bandhu, students’ credit card and Lakhi Bandhu ( basic income for women) schemes have been given a. Allocations have also been increased for food and civil supplies and Covid relief.