The Chief Minister, Mr. Jai Ram Thakur, presented the Budget for Himachal Pradesh for the financial year 2020-21 on March 6, 2020.

Budget Highlights

  • The Gross State Domestic Product (GSDP) of Himachal Pradesh for 2020-21 (at current prices) is projected to be Rs 1,82,020 crore.  This is 10% higher than the revised estimates for 2019-20.  GSDP for 2019-20 (at current prices) is estimated to be 7.6% higher than that in 2018-19.
     
  • Total expenditure for 2020-21 is estimated to be Rs 49,131 crore, a 1.1% decrease over the revised estimates of 2019-20.  As per the revised estimates, total expenditure is estimated to increase by 11.9% (Rs 5,300 crore) from the budget estimates in 2019-20. 
     
  • Total receipts (excluding borrowings) for 2020-21 are estimated to be Rs 38,465 crore, an increase of 18.9% as compared to the revised estimates of 2019-20.  In 2019-20, total receipts (excluding borrowings) are estimated to fall short of the budgeted estimates by Rs 1,413 crore (4.2% of the budget estimates). 
     
  • Revenue deficit for 2020-21 is targeted at Rs 684 crore or 0.38% of the GSDP.  Fiscal deficit is targeted at Rs 7,272 crore (4% of GSDP).  In 2019-20, Himachal Pradesh is estimated to observe a revenue deficit of 2.42% of GSDP as against a budget target of 1.39%.  Fiscal deficit is estimated to rise from the budgeted 4.35% of GSDP to 6.42% of GSDP at the revised stage.
     
  • In 2020-21, the highest increase in allocations was observed in Water Supply, Sanitation, Housing and Urban Development (33%), Rural Development (19%), and Education (10%) sectors over the revised estimates of the previous year.  Significant decrease in allocation was observed in Energy (21%) and Irrigation (13%) sectors.

Policy Highlights

  • Legislative proposals: Himachal Pradesh will enact Model Acts proposed by the central government to remove bottlenecks in the agriculture sector.  Cooperation laws will be amended to help cooperative societies to improve their capacity and incomes.  A Bill to provide for the establishment of the Himachal Pradesh Investment Promotion Agency will be introduced.  Model Municipal Building Bye-Laws will be introduced to promote the development of disaster-resilient structure.
  • Aspirational District Block Programme: The Aspirational District Block Programme will be started to facilitate the development of panchayats and blocks in backward areas.
     
  • Swaran Jayanti Poshahaar Yojana: The scheme will be introduced to provide for: (i) supplementing extra nutrition food such as milk and fruit in Anganwadi and mid-day meal schemes in primary and middle schools and (ii) starting pre-primary classes in the primary schools (Swasth Bachpan).  For more details on the budget announcements, please see Annexure 3. 

Himachal Pradesh’s Economy

  • GSDP:  The growth rate of Himachal Pradesh’s GSDP (at constant prices) was 7.3% in 2018-19, higher than the GDP growth rate of the country.
     
  • Sectors:  In 2018-19, agriculture, manufacturing, and services sectors contributed to 13%, 47% and 40% to the economy.  These sectors grew by 2.8%, 10.2%, and 5.4%, respectively.
     
  • Per capita GSDP of Himachal Pradesh in 2018-19 (at current prices) was Rs 2,08,513, 8% higher than the corresponding figure in 2017-18.  
  • Unemployment:  According to the Periodic Labour Force Survey (July 2017-June 2018), the unemployment rate in Himachal Pradesh was 8.6%, which is higher than that at the all-India level (6.1%).

Figure 1: Growth in GSDP and sectors in Himachal Pradesh at constant (2011-12) prices

 

Sources: Central Statistics Office; MOSPI; PRS.

Note: These numbers are as per constant prices (2011-12) which implies that the growth rate is adjusted for inflation.

Budget Estimates for 2020-21

  • The total expenditure in 2020-21 is targeted at Rs 49,131 crore.  This is 1.1% lower than the revised estimates of 2019-20.  This expenditure is proposed to be met through receipts (other than borrowings) of Rs 38,465 crore and borrowings of Rs 7,554 crore.  Total receipts for 2020-21 (other than borrowings) are expected to be 18.9% higher than the revised estimates of 2019-20.
     
  • As per the revised estimates of 2019-20, while the receipts (other than borrowings) are estimated to reduce by 4.2% over the budget estimates, the total expenditure is estimated to increase by 11.9%.   This implies that there will be an increase in the borrowing requirement.  As a result, in 2019-20, the state is estimated to observe a revenue deficit of 2.42% as against a budget target of 1.39%.  Fiscal deficit is estimated to rise from the budgeted 4.35% of GSDP to 6.42% of GSDP at the revised stage.  

Table 1: Budget 2020-21 - Key figures (in Rs crore)

Items

2018-19 Actuals

2019-20 BE

2019-20 

RE

% change from BE 2019-20 to RE 2019-20

2020-21 BE

% change from RE 2019-20 to BE 2020-21

Total Expenditure

39,154

44,388

49,688

11.9%

49,131

-1.1%

A. Receipts (except borrowings)

30,981

33,774

32,360

-4.2%

38,465

18.9%

B. Borrowings

6,427

7,081

10,520

48.6%

7,554

-28.2%

Total Receipts (A+B)

37,408

40,854

42,880

5.0%

46,019

7.3%

Revenue Balance

1,522

-2,342

-4,007

71.1%

-684

-82.9%

As % of GSDP

0.99%

-1.39%

-2.42%

 

-0.38%

 

Fiscal Deficit

              3,500 

       7,352 

       10,626 

44.5%

        7,272 

-31.6%

As % of GSDP

2.27%

4.35%

6.42%

 

4.00%

 

Primary Balance

               522 

       -2,802 

         -6,076 

116.8%

        -2,340 

-61.5%

As % of GSDP

0.34%

-1.66%

-3.67%

 

-1.29%

 

Note: BE is Budget Estimates; RE is Revised Estimates.  Negative sign in revenue balance and primary balance indicates a deficit.

Sources: Himachal Pradesh Budget Documents 2020-21; PRS.

Expenditure in 2020-21

  • Capital expenditure for 2020-21 is proposed to be Rs 10,008 crore, which is a decrease of 25% over the revised estimates of 2019-20.  Capital expenditure includes expenditure affecting the assets and liabilities of the state, such as: (i) capital outlay, i.e. expenditure which leads to the creation of assets (such as bridges and hospitals), and (ii) repayment and grant of loans by the state government. 
     
  • In 2019-20, capital expenditure is estimated to increase by 60.9% from the budget stage to the revised stage. The debt repayment is estimated to increase by 3,439 crore (105.4%) at the revised stage as compared to the budget stage.
     
  • Himachal Pradesh’s capital outlay for 2020-21 is estimated to be Rs 6,255 crore, which is 5.2% higher than the revised estimates of 2019-20.  In 2019-20, the revised estimates for capital outlay is 29.8% higher as compared to the budget estimate for that year.
     
  • Revenue expenditure for 2020-21 is proposed to be Rs 39,123 crore, which is an increase of 7.7% over revised estimates of 2019-20.  This expenditure includes the payment of salaries, interest, and subsidies.  

Table 2: Expenditure budget 2020-21 (in Rs crore)

Items

2018-19 Actuals

2019-20 

BE

2019-20 

RE

% change from BE 2019-20 to RE 2019-20

2020-21 

BE

% change from RE 2019-20 to BE 2020-21

Capital Expenditure

9,726

8,299

13,351

60.9%

10,008

-25.0%

  of which Capital Outlay

4,584

4,580

5,943

29.8%

6,255

5.2%

Revenue Expenditure

29,429

36,089

36,337

0.7%

39,123

7.7%

Total Expenditure

          39,154 

          44,388 

          49,688 

11.9%

        49,131 

-1.1%

A. Debt Repayment

4,673

3,262

6,701

105.4%

3,394

-49.4%

B. Interest Payments

4,022

4,550

4,550

0.0%

4,932

8.4%

Debt Servicing (A+B)

8,695

7,812

11,251

44.0%

8,325

-26.0%

Note: BE is Budget Estimates; RE is Revised Estimates.  Capital outlay denotes expenditure which leads to the creation of assets.

Sources: Himachal Pradesh Budget Documents 2020-21; PRS.  

Sector-wise expenditure in 2020-21

The sectors listed below account for 65% of the total expenditure by the state in 2020-21.  A comparison of Himachal Pradesh’s expenditure on key sectors with that by other states can be found in Annexure 1.

Table 3: Sector-wise expenditure under Himachal Pradesh Budget 2020-21 (in Rs crore)

Sector

2018-19 Actuals

2019-20 

BE

2019-20 

RE

2020-21 

BE

% change from 2019-20 RE to 2020-21 BE

Budget provisions for 2020-21

Education, Sports, Arts, and Culture

      6,198 

      7,859 

      7,581 

      8,304 

10%

Rs 6,016 crore will be spent on salaries and wages.  Rs 289 crore has been allocated for the Sarv Shiksha Abhiyaan.  Rs 101 crore has been allocated for the Mid-Day Meal scheme.

Transport

      3,902 

      4,109 

      5,158 

      5,445 

6%

Capital outlay of Rs 1,912 crore has been proposed for construction of roads and bridges.  Budgetary provision of Rs.1,013 crore has been made for expansion of airports, construction of airport at Mandi and construction of 5 heliports.

Water Supply, Sanitation, Housing and Urban Development

      2,209 

      2,521 

      2,490 

      3,302 

33%

Rs 343 crore has been allocated towards Jal Jeevan Mission.  Rs 108 crore will be spent on the Greater Shimla Water Supply Scheme.  Rs 100 crore has been allocated towards the Smart City mission.  

Health and Family Welfare

      2,238 

      2,752 

      2,791 

      2,976 

7%

Rs 1,715 crore will be spent on salaries and wages.  Rs 334 crore has been allocated towards the National Rural Health Mission.

Agriculture and allied activities

      2,194 

      2,492 

      2,476 

      2,702 

9%

Rs 50 crore has been allocated towards subsidy for installation of anti-hail nets.  Rs 25 crore has been allocated towards the Prakritik Kheti Khushal Kissan scheme.

Social Welfare and Nutrition

      1,641 

      1,592 

      2,233 

      1,965 

-12%

Rs 670 crore has been allocated towards pension under social security schemes.  Rs 230 crore has been allocated towards food subsidy.

Rural Development

      1,193 

      1,722 

      1,464 

      1,739 

19%

Rs 394 crore has been allocated towards the Pradhanmantri Gram Sadak Yojana.  Rs 100 crore has been allocated towards the SwarnaJayanti Gram Swarojgar Yojana.  Rs 55 crore has been allocated to the Mukhya Mantri Gram Sadak Yojana.

Police

      1,158 

      1,425 

      1,446 

      1,541 

7%

Rs 1,463 crore will be spent towards salaries and wages. Rs 37 crore has been allocated towards modernisation of police forces.

Irrigation and Flood Control

         885 

      1,036 

      1,264 

      1,100 

-13%

Capital outlay of Rs 557 crore has been proposed on various irrigation projects.

Energy

         834 

         760 

         818 

         645 

-21%

Rs 480 crore has been allocated as subsidy for domestic and agricultural consumers.

% of total expenditure

66%

65%

66%

65%

 

 

Sources: Himachal Pradesh Budget Documents 2020-21; PRS.

Committed expenditure:  Committed expenditure of a state typically includes expenditure on payment of salaries, pensions, and interest.  A larger proportion of budget allocated for committed expenditure items limits the state’s flexibility to decide on other expenditure priorities such as capital outlay.  

In 2020-21, Himachal Pradesh is estimated to spend Rs 27,036 crore on committed expenditure items.  This is 11.7% higher than the revised estimates of 2019-20.  In 2020-21, Himachal Pradesh is estimated to spend 70% of its revenue receipts on committed expenditure items.  This comprises of spending on salaries (39% of revenue receipts), pension (19%), and interest payments (13%).  In 2020-21, expenditure on salaries is estimated to increase by 14% over the revised estimates of 2019-20.

Table 4: Committed Expenditure for the state in 2020-21 (in Rs crore)

Items 

2018-19 Actuals

2019-20 BE

2019-20 RE

% change from BE 2019-20 to RE 2019-20

2020-21 Budgeted

% change from RE 2019-20 to BE 2020-21

Salaries

11,014

13,889

12,988

-6.5%

14,838

14.2%

Pensions

4,975

6,660

6,660

0.0%

7,266

9.1%

Interest

4,022

4,550

4,550

0.0%

4,932

8.4%

Total 

                 20,010 

               25,099 

                24,198 

-3.6%

                        27,036 

11.7%

Note: BE is Budget Estimates; RE is Revised Estimates.  

Sources:  Himachal Pradesh Budget Documents 2020-21; PRS.
 

Receipts in 2020-21

  • The total revenue receipts for 2020-21 are estimated to be Rs 38,439 crore, an increase of 18.9% over the revised estimates of 2019-20.  Of this, Rs 11,501 crore (30%) will be raised by the state through its own resources, and Rs 26,938 crore (70%) will come from the centre in the form of grants (54% of revenue receipts) and the state’s share in central taxes (16% of revenue receipts).
  • Devolution:  In 2020-21, receipts from the state’s share in central taxes are estimated to increase by 34% over the revised estimates of 2019-20.  However, as per the revised estimates of 2019-20, the receipts from the state’s share in central taxes is estimated to decrease by 36.8% as compared to the budget stage.  This may be due to a 19% cut in the union budget for devolution to states, from Rs 8,09,133 crore at the budget stage to Rs 6,56,046 crore at the revised stage.  Himachal Pradesh’s share in the centre’s tax revenue will increase from 0.30% during the 2015-20 period to 0.33% for 2020-21 (an increase of 10%) as per the recommendations of the 15th Finance Commission (Annexure 2).
  • Tax Revenue:  Total own tax revenue of Himachal Pradesh is estimated to be Rs 9,090 crore in 2020-21, an increase of 13.6% over the revised estimates of the previous year.  The own tax to GSDP ratio is targeted at 5.0% in 2020-21, which is higher than the revised estimates for 2019-20 (4.8%).  This implies that the growth in tax collection is estimated to be higher than the growth of the economy.

Table 5: Break up of state government receipts (in Rs crore)

Items

2018-19 Actuals

2019-20 

BE

2019-20 

RE

% change from BE 2019-20 to RE 2019-20

2020-21 

BE

% change from RE 2019-20 to BE 2020-21

State's Own Tax

       7,576 

7,921

       8,005 

1.0%

         9,090 

13.6%

State's Own Non-Tax

       2,830 

       2,443 

       2,372 

-2.9%

         2,410 

1.6%

Share in Central Taxes

       5,427 

       7,398 

       4,678 

-36.8%

         6,266 

34.0%

Grants-in-aid from Centre

      15,118 

      15,985 

      17,276 

8.1%

       20,673 

19.7%

Total Revenue Receipts

30,950

33,747

32,330

-4.2%

       38,439 

18.9%

Borrowings

6,427

7,081

10,520

48.6%

7,554

-28.2%

Other receipts

            31 

            27 

            31 

14.8%

             26 

-14.6%

Total Capital Receipts

       6,458 

       7,107 

      10,550 

48.4%

         7,580 

-28.2%

Total Receipts

37,408

40,854

42,880

5.0%

       46,019 

7.3%

Note: BE is Budget Estimates; RE is Revised Estimates.  

Sources: Himachal Pradesh Budget Documents 2020-21; PRS. 

GST Compensation

The GST (Compensation to States) Act, 2017 guarantees states compensation for five years (till 2022) for any revenue loss arising due to GST implementation.  The Act guarantees states a 14% annual growth on their revenue which was subsumed under GST.  If the GST revenue of a state does not match the guaranteed growth, compensation grants are provided to meet the shortfall.  

The state is estimated to receive GST compensation grants in all three years between 2018-19 and 2020-21.  In 2020-21, this grant is estimated to be Rs 3,338 crore (8.7% of the total revenue receipts).  This is 15% higher than the revised estimates of the previous year.  Reliance on GST compensation grants indicates a slower growth in SGST collection as compared to the 14% annual growth envisaged under the Act.

  • In 2020-21, State Goods and Services Tax (SGST) is estimated to be the largest source of own tax revenue (42.4% of total own tax revenue).  SGST collection is estimated to increase by 8.9% over the previous year.
     
  • In 2020-21, Himachal Pradesh is expected to generate Rs 1,788 crore from state excise duty, an increase of 10% over the previous year.
     
  • The state is estimated to raise Rs 1,685 crore from sales tax (on items such as petroleum products), and VAT, an increase of 38.4% over the revised estimates of 2019-20.  

Table 6: Some of the major state’s own tax revenue sources (in Rs crore)

Head

2018-19 Actuals

2019-20 BE

2019-20
 RE

% change from BE 2019-20 to RE 2019-20

2020-21 BE

% change from RE 2019-20 to BE 2020-21

% of Revenue Receipts in 2020-21

State GST (SGST)

       3,343 

       3,238 

       3,542 

9.4%

       3,855 

8.9%

10.0%

State Excise Duty

       1,482 

       1,625 

       1,625 

0.0%

       1,788 

10.0%

4.7%

Sales Tax and VAT

       1,185 

       1,491 

       1,217 

-18.4%

       1,685 

38.4%

4.4%

Taxes on Vehicle

          408 

          363 

          432 

19.2%

          457 

5.7%

1.2%

Stamps Duty and Registration Fees

          251 

          289 

          289 

0.0%

          328 

13.3%

0.9%

Taxes and Duties on Electricity

          487 

          378 

          378 

0.0%

          403 

6.6%

1.0%

Land Revenue

             8 

            23 

            16 

-27.5%

            18 

8.9%

0.05%

GST Compensation Grants

2,037

2,900

2,900

0%

3,338

15.1%

8.7%

Note: BE is Budget Estimates; RE is Revised Estimates.

Sources: Himachal Pradesh Budget Documents 2020-21; PRS.

Deficits, Debts and FRBM Targets for 2020-21

The Himachal Pradesh Fiscal Responsibility and Budget Management (FRBM) Act, 2005 provides annual targets to progressively reduce the outstanding liabilities, revenue deficit and fiscal deficit of the state government.  

Revenue Balance:  It is the difference of revenue expenditure and revenue receipts.   A revenue deficit implies that the government needs to borrow to finance its expenses which do not create capital assets.  Once the revenue deficit is accounted for, only then the borrowings can be used for capital investments.  A revenue surplus implies that the revenue receipts of state are sufficient to meet the revenue expenditure requirements.

The budget estimates a revenue deficit of Rs 684 crore (0.38% of GSDP) in 2020-21.  The 14th Finance Commission had recommended that states should eliminate revenue deficit.  However, between 2019-20 and 2023-24, the state is estimated to observe revenue deficit (Figure 2).  The 15th Finance Commission recommended a post-devolution revenue deficit grant of 11,431 crore for Himachal Pradesh for 2020-21.  This grant has been provided to compensate for the revenue deficit.

Fiscal deficit:  It is the excess of total expenditure over total receipts.  This gap is filled by borrowings by the government, and leads to an increase in total liabilities.  In 2020-21, the fiscal deficit is estimated to be Rs 7,272 crore (4% of GSDP).  The estimate is beyond the 3% limit as per the FRBM Act.  The 3% limit may be relaxed to a maximum of 3.5%, if the state can contain its debt and interest payments to certain specified levels.  The fiscal deficit of the state is estimated to remain greater than 3% between 2019-20 and 2023-24.

Debt Servicing

In 2020-21, Himachal Pradesh is expected to spend Rs 8,325 crore on servicing its debt.     This is 26% less than the revised estimates of 2019-20. This includes Rs 3,394 crore towards repaying loans (41%), and Rs 4,932 crore towards interest payments (59%).  

Outstanding Liabilities: Outstanding liabilities is the accumulation of borrowings over the years. In 2020-21, the outstanding liabilities are expected to be 33.62% of the GSDP, 0.06% lower than the revised estimates for 2019-20.  This is higher than the average level of outstanding liabilities of 29 states in 2019-20 (24.6% of their GSDP).   

Outstanding Government Guarantees: Outstanding liabilities of states do not include a few other liabilities that are contingent in nature, which states may have to honour in certain cases.  State governments often guarantee the borrowings of State Public Sector Enterprises (SPSEs) from financial institutions.  The total outstanding government guarantees at the end of the year 2020-21 is estimated to be Rs 2,422 crore (1.3% of GSDP). 

Table 7: Budget targets for deficits for Himachal Pradesh (% of GSDP)

Year

Revenue 

Fiscal 

Outstanding Liabilities

Deficit (-)/Surplus (+) 

Deficit (-)/Surplus (+)  

2018-19

0.99%

-2.27%

-

2019-20

-2.42%

-6.42%

33.68%

2020-21

-0.38%

-4.00%

33.62%

2021-22

-0.41%

-3.96%

33.56%

2022-23

-2.34%

-5.82%

33.51%

2023-24

-2.66%

-6.07%

33.47%

Note: Numbers for 2019-20 and 2020-21 are revised estimates and budget estimates respectively.  Numbers for 2021-22, 2022-23, and 2023-24 are targets as per the Medium Term Fiscal Policy Statement.  As per the statement, deficits are estimated to rise post 2021-22 due to discontinuation of GST compensation grants.

Sources: Himachal Pradesh Budget Documents 2020-21; PRS.                                                      

Figure 2: Revenue and Fiscal Balance (as % of GSDP) 

Note: (-) indicates deficit and (+) indicates a surplus. 

Sources: Himachal Pradesh Budget Documents; PRS.  

Figure 3: Outstanding liabilities (as % of GSDP)

Sources: Himachal Pradesh Budget Documents; PRS.  

Annexure I:  Comparison of states’ expenditure on key sectors

The graphs below compare Himachal Pradesh’s expenditure on six key sectors as a proportion of its total expenditure on all sectors.  The average for a sector indicates the average expenditure in that sector by 29 states as per their budget estimates of 2019-20. [1]

  • Education:  Himachal Pradesh has allocated 18.3% of its total budget for education in 2020-21.  This is higher than the average expenditure (15.9%) allocated for education by states (using 2019-20 BE).
  • Health:  Himachal Pradesh has allocated 6.6% of its total budget on health, which is higher than the average allocation for health by states (5.3%). 
     
  • Agriculture:  The state has allocated 6.0% of its total expenditure towards agriculture and allied activities.  This is lower than the average allocated by states (7.1%).
     
  • Rural development:  Himachal Pradesh has allocated 3.8% of its expenditure on rural development.  This is significantly lower than the average allocation for rural development by states (6.2%).
     
  • Roads and bridges:  Himachal Pradesh has allocated 8.8% of its total expenditure on roads and bridges, which is significantly higher than the average expenditure of 29 states (4.2%). 
     
  • Police:  Himachal Pradesh has allocated 3.4% of its total expenditure on police, which is lower than the average allocation for police by states (4.1%).

Note: 2018-19, 2019-20 (BE), 2019-20 (RE), and 2020-21 (BE) figures are for Himachal Pradesh.

Sources: Annual Financial Statement (2019-20 and 2020-21), various state budgets; PRS.

Annexure 2:  Recommendations of the 15th Finance Commission for 2020-21

The 15th Finance Commission’s (15th FC) report for the financial year 2020-21 was tabled in Parliament on February 1, 2020.  The 15th FC recommended a 41% share for states in the central government’s tax revenue in 2020-21, a 1% decrease from the 42% share recommended by the 14th FC (2015-20).  The 1% decrease is to provide funds to the newly formed union territories of Jammu and Kashmir, and Ladakh from the share of the central government.   The 15th FC also proposed revised criteria for determining the share of individual states.

Table 8 shows the share of states in the central government's tax revenue [2], as per the recommendations of the 14th FC for 2015-20 and the 15th FC for 2020-21.  The 15th FC has recommended a 0.33% share for Himachal Pradesh in the centre’s tax revenue for 2020-21 (an increase of 10% over the 14th FC period).  This implies that out of every Rs 100 of centre’s tax revenue in 2020-21, Himachal Pradesh will receive Rs 0.33.  Table 8 also shows the estimated devolution to states by the centre for 2019-20 and 2020-21 (in Rs crore).

Table 8:  Share of states in centre’s tax revenue under the 14th and 15th Finance Commissions (2020-21)

State

Share of states in centre’s tax revenue

Devolution to states by the centre

14th FC (2015-20)

15th FC (2020-21)

% change

2019-20 RE

2020-21 BE

% change

Andhra Pradesh

1.81

1.69

-7%

28,242

32,238

14%

Arunachal Pradesh

0.58

0.72

24%

8,988

13,802

54%

Assam

1.39

1.28

-8%

21,721

24,553

13%

Bihar

4.06

4.13

2%

63,406

78,896

24%

Chhattisgarh

1.29

1.4

9%

20,206

26,803

33%

Goa

0.16

0.16

0%

2,480

3,027

22%

Gujarat

1.3

1.39

7%

20,232

26,646

32%

Haryana

0.46

0.44

-4%

7,112

8,485

19%

Himachal Pradesh

0.3

0.33

10%

4,678

6,266

34%

Jammu and Kashmir

0.78

-

-

12,171

-

-

Jharkhand

1.32

1.36

3%

20,593

25,980

26%

Karnataka

1.98

1.49

-25%

30,919

28,591

-8%

Kerala

1.05

0.8

-24%

16,401

15,237

-7%

Madhya Pradesh

3.17

3.23

2%

49,518

61,841

25%

Maharashtra

2.32

2.52

9%

36,220

48,109

33%

Manipur

0.26

0.29

12%

4,048

5,630

39%

Meghalaya

0.27

0.31

15%

4,212

5,999

42%

Mizoram

0.19

0.21

11%

3,018

3,968

31%

Nagaland

0.21

0.23

10%

3,267

4,493

38%

Odisha

1.95

1.9

-3%

30,453

36,300

19%

Punjab

0.66

0.73

11%

10,346

14,021

36%

Rajasthan

2.31

2.45

6%

36,049

46,886

30%

Sikkim

0.15

0.16

7%

2,408

3,043

26%

Tamil Nadu

1.69

1.72

2%

26,392

32,849

24%

Telangana

1.02

0.87

-15%

15,988

16,727

5%

Tripura

0.27

0.29

7%

4,212

5,560

32%

Uttar Pradesh

7.54

7.35

-3%

1,17,818

1,40,611

19%

Uttarakhand

0.44

0.45

2%

6,902

8,657

25%

West Bengal

3.08

3.08

0%

48,048

58,963

23%

Total 

42

41

-2%

6,56,046

7,84,181

20%

Sources:  Reports of 14th and 15th Finance Commissions (2020-21); Union Budget Documents 2020-21; PRS.

In addition, the 15th FC has also recommended certain grants-in-aid for various purposes for the year 2020-21.  These include: (i) Rs 74,341 crore as grants to states for eliminating revenue deficit, of which Himachal Pradesh will receive Rs 11,431 crore, (ii) Rs 90,000 crore as grants to local bodies, of which Himachal Pradesh will receive Rs 636 crore (this consists of Rs 429 crore for rural local bodies and Rs 207 crore for urban local bodies), and (iii) Rs 22,184 crore as the centre’s grants to disaster management, out of which Himachal Pradesh will receive Rs 409 crore.

Annexure 3:  Key budget announcements

  • Insurance coverage will be provided to certain classes of workers such as Anganwadi workers/helpers, ASHA workers, water carriers, water guards, mid-day meal workers, and tailoring mistress.
     
  • Income criteria for giving land to landless/houseless persons is to enhanced from Rs 50,000 to Rs 1,00,000 per annum.
     
  • Minimum wage rate will be revised from Rs 250 per day to Rs 275 per day.
  • Grant of death-cum-retirement gratuity will be provided to employees covered under the National Pension Scheme (NPS) who retired before September 2017.
     
  • Emoluments for contract employees is proposed to be increased from 125% of grade pay to 150% of grade pay.
     
  • 20,000 vacant posts of various departments will be filled up during 2020-21. It includes (i) 3,000 posts of the State Electricity Board, (ii) 1,000 posts of Constables, (iii) over 5,000 posts in Education, and (iv) 1,300 posts in the Road Transport Commission.
     
  • Hydro-electric projects of 394 MW capacity will be started during 2020-21.
     
  • One-time relief to the power producers will be provided for speeding up the execution of stalled projects.
     
  • Subsidy of Rs 2,000 per KW will be provided for executing solar projects of 250 to 500 KW capacities.
     
  • A Centre of Excellence will be established to promote skill development, training and research activities in Information Technology with a cost of Rs 155 crore.
     
  • Institute of Hotel Management in Dharamshala and Food Craft Institute in Sundernagar will be established.
     
  • The State Sports Policy 2020 will be notified.
     
  • Policy to provide Way Side Amenities along highways will be framed.
  • Milk procurement price will be increased by Rs 2 per litre.
     
  • Increase in honorarium for certain classes of workers is proposed (Table 9).

Table 9: Proposal to increase the honorarium

Position

Increase in monthly honorarium (in Rs)

Panchayat Silai teachers and chowkidars

500

Mid-day meal workers and water carriers

300

ASHA workers

500

Part-time workers under the revenue department

300

Numberdars

500

Water guards, para fitters and pump operators

300

Sources: Budget Speech 2020-21; PRS.

  • Certain changes in benefits under the existing schemes are proposed (Table 10).

Table 10: Proposals against existing schemes

Scheme

Proposal

Mukhya Mantri Nirog Yojana

10 new integrated nirog clinic to be opened, free diagnostic facilities to be extended to all

SAHARA

Assistance to the chronically ill patients to be increased from Rs 2,000 per month to Rs 3,000 per month

Skill Development Allowance

80,000 youths to be provided skill development allowance with an outlay of Rs 100 crore

Pension schemes

50 thousand more beneficiaries to be covered in 2020-21, pension for divyangjans and widows to be increased from Rs 850 per month to Rs 1000 per month

War Jagir Assistance

Assistance to ex-servicemen to be increased from Rs 5,000 per annum to Rs 7,000 per annum

Vidhayak Kshetra Vikas Nidhi Yojana

Allocation to be increased from Rs 1.5 crore to Rs 1.75 crore and discretionary grants of MLAs to be increased from Rs eight lakh to Rs 10 lakh

Sources: Budget Speech 2020-21; PRS.

Table 11: New schemes announced in the Budget 2020-21

Scheme

Sector

Description

Allocation for 2020-21 (in Rs)

Krishi Kosh

Agriculture

A fund of 20 crore to provide seed money, interest subvention, and credit guarantee cover for farmer producer organisations

 

Krishi se Sampannta Yojana

Agriculture

Promotion of heeng (asafoetida)  cultivation and saffron production in selected areas

-

Krishi Utpaad Sarankshan Yojana

Agriculture

subsidy for installation of a permanent structure to fix anti-hail nets

50 crore (inclusive of certain existing subsidies)

Madhu Utpadan evam Prasanskaran Yojana

Agriculture

Promotion of value addition to bee-keeping activities

7 crore

Mehak

Agriculture

Assistance in cultivation, processing, and marketing of aromatic plants

-

Him Kukkut Palan Yojana

Agriculture

Promotion of poultry farming, 100 farmers will be provided up to 5,000 broilers every year

-

Mobile Veterinary Sewa (MOVES)

Agriculture

Doorstep delivery of veterinary services

-

Parvat Dhara

Rural Development

Rejuvenation of extinct and depleted water sources, to be managed and maintained under MNREGS

20 crore

UNNATI

Rural Development

Skill development of at least one member from the families of beneficiaries of MNREGS

-

Panchawati

Rural Development

Promotion of parks and gardens in the rural areas

-

Solid Waste Management

Rural Development

500 panchayats to be made solid waste-free during 2020-21 in the first phase

-

Swaran Jayanti Gyanodaya Cluster Sreshtha Vidyalaya Yojana

Education

Modern facilities such as smart classrooms in 100 cluster schools, improvement of pupil-teacher ratio

15 crore

Swaran Jayanti Utkrisht Vidyalaya Yojana

Education

Improvement of facilities such as furniture, sports facilities, labs in 68 schools in the first phase

30 crore

Swaran Jayanti Super 100

Education

To encourage meritorious youth for admission to professional courses

-

Swasth aur Sashakat Kishoritav evam Matritva (SKM)

Health and Family Welfare

Mammography facility in all district hospitals to fight breast cancer, prevention and awareness about cervical cancer

-

HIMAROGYA

Health and Family Welfare

IT system to provide unique health ID to all citizens

-

Mobile Health Centres

Health and Family Welfare

10 new mobile health centres to provide healthcare services in remote areas

-

Samman

Health and Family Welfare

Provision of free treatment including diagnostic to destitute persons left without identity and attendant in hospitals

-

Paramparik Hathkargha Evam Hastshilp Cluster Protsahan Pariyojana

Industry

Promotion of artisans and craftsmen and their products in each district on a cluster basis

-

Swaran Jayanti Poshahaar Yojana

Social Welfare and Nutrition

Umbrella scheme with following components:
 (i) Bal Poshahaar Top-up Yojana- fruit, milk and fibrous food for Anganwadi children, (ii) Swasth Bachpan- pre-primary students enrolled in government schools, mid-day meal to be provided to pre-primary students, (iii) supplement of fruit and milk to primary and middle schools students along with the mid-day meal

-

Woh Din

Social Welfare and Nutrition

Awareness campaign on menstrual hygiene

3.24 crore

Sources: Budget Speech 2020-21; PRS.                                            

 

[1] The 28 other states include all states except Manipur.  It includes the Union Territory of Delhi and erstwhile state of Jammu and Kashmir.

[2] This excludes the cess and surcharge revenue of the central government as it is outside the divisible pool and not shared with states.  As per the 2019-20 union budget, cess and surcharge revenue accounted for 15% of the estimated gross tax revenue of the central government.

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