GOVERNMENT OF MEGHALAYA

BUDGET SPEECH 2005-2006

Thursday the 24th March, 2005

 

Mr. Speaker Sir,
 

I rise to present the Budget Estimates for the year 2005-2006 which is the fourth year of the Tenth Plan and the first year of the period covered by the Award of the Twelfth Finance Commission.
 

INTRODUCTION
 

Against the approved size of the Annual Plan, 2004-05 of Rs.716.34 crores, the size of the Annual Plan 2005-06 has been fixed at Rs.800.00 crores during the meeting between the Chief Minister and the Deputy Chairman of the Planning Commission. The priorities of the Annual Plan, 2005-06 are on Agriculture and Allied sectors, Rural Development, Power,  Road Communication, Education, Health, Water Supply, Urban Development and Social Welfare including nutrition and Housing.

The recommendations of the Twelfth Finance Commission which will be effective for five years from 1.4.2005 provide a roadmap for reforms intended to put the State finances on a sustainable path and these include:-
 

raising of the share of States in the net proceeds of shareable Central taxes from 29.5 percent to 30.5 per cent, and

 

consolidation and rescheduling of Central loans contracted till March, 2004 and outstanding as on 31st March, 2005 for a fresh term of 20 years, at a rate of interest of 7.5 per cent, subject to the enactment of fiscal responsibility legislation by the States.
 

NATIONAL ECONOMY
 

The Union Budget proposals for the year 2005-06 reflect a buoyant growth of the economy in spite of a deficient south-west monsoon, hardening international prices of oil and steel and the first recorded experience of Tsunami which caused extensive damage to life and property in the Andaman and Nicobar islands and 2260 kms of coastline in coastal States. The growth rate of the Indian  economy during 2004-05 is estimated at 6.9 per cent. After a drought - related decline of 7.0 per cent in 2002-03, the growth rate in the agriculture and allied sector bounced back to 9.6 per cent during 2003-04.  While industry maintained the growth rate of 6.6 per cent during 2002-03, the services sector improved its performance significantly from 7.9 per cent in 2002-03 to 9.1 per cent in 2003-04.

The Agriculture and allied sector is expected to grow by 1.1 per cent during the current year. Inflation which touched a high of 8.7 per cent during August 2004 has been reined in. During February 2005, the rate of inflation was 5.01 per cent which is more than one percentage point lower than what it was during the same month in the previous year.

The Union Budget for the year 2005-06 is based on the strategy of -
 
 

multi-pronged and integrated approach to contain poverty and unemployment,

 

doubling the supplementary nutrition norms and sharing one-half of the States' costs for this purpose,

 

awarding larger scholarships which meet the requirements of tuition fees, living expenses, books and a computer to any SC/ST student who secures admission in any Institute of Excellence,

 

creation of infrastructure, especially in rural India, in selected sectors covering irrigation, roads, water supply, housing, rural electrification and rural telecom connectivity under the 'Bharat Nirman' programme.

 

enhancement of public and private investment required to support expansion, diversification and value addition in all the three sectors of the economy,

 

strengthening of the financial sector through further reforms in bank finance and debt and equity markets, and

 

setting up of Institutions of Excellence.
 

STATE ECONOMY

The Gross State Domestic Product in terms of per capita income at current prices registered an increase from Rs.20,463 during 2003-04 to an estimated Rs.22,727 during 2004-05. However, the relative growth during the same period at constant prices i.e. 1993-94 prices is from Rs.11,961 during 2003-04 to Rs.12,578 during 2004-05 as per Quick Estimates, indicating an annual growth of 5.16 per cent.

The Economy of the State as reflected in the Advanced Estimate of GSDP during 2003-04 and the Project Estimate of 2004-05 shows an improvement. The GSDP of the State estimated at Rs.4907.01 crore during 2003-04 rose to Rs.5520.40 crore during the current year, thereby showing an increase of 12.5 per cent over the period. The estimate of GSDP at constant prices during the same period were estimated at Rs.2,868.34 crore and Rs.3,055.24 crore respectively registering a growth of 6.52 per cent.

The share of the primary sector in GSDP at constant prices has been estimated at 22.91 per cent during 2003-04 and 23 per cent during the current year. A similar trend is observed in the Secondary sector with a contribution of 23.67 per cent during 2003-04 and 24 per cent during the current year. While the tertiary sector continues to dominate the economy, its share has continued at 53 per cent during the current year.

STATE FINANCES

1.

The Annual Accounts of the State for the year 2003-2004 reflects the following position-

a)
 

The year opened with an opening deficit of Rupees Four crore, eighty six lakhs, thirty six thousand (Rs.4,86,36,000).

b)



 

Against a total revenue receipt of Rupees One thousand three hundred ninety eight crore, eighty two lakhs, fifty four thousand (Rs.1,398,82,54,000), the total revenue expenditure was Rupees One thousand three hundred thirteen crore, sixty eight lakhs, ninety two thousand (Rs.1,313,68,92,000), resulting in a revenue surplus of Rupees Eighty five crore, thirteen lakhs, sixty two thousand (Rs.85,13,62,000).

c)




 

Against the total revenue receipts, recoveries and other receipts amounting to Rupees One thousand four hundred sixteen crore, ninety four lakhs, twenty one thousand (Rs.1,416,94,21,000), the total revenue and capital expenditure excluding Public Debt was Rupees One thousand six hundred eighteen crore, seventy eight lakhs, fifty thousand (Rs.1,618,78,50,000), resulting in a fiscal deficit of Rupees Two hundred one crore, eighty four lakhs, twenty nine thousand (Rs.201,84,29,000).

d)



 

Against the fiscal deficit of Rupees Two hundred one crore, eighty four lakhs, twenty nine thousand (Rs.201,84,29,000), there was an interest payment of Rupees One hundred seventy crore, three lakhs, thirty five thousand (Rs.170,03,35,000), resulting in a primary deficit of Rupees Thirty one crore, eighty lakhs, ninety four thousand (Rs.31,80,94,000).

e)







 

Against a total budgetary receipt of Rupees Twelve thousand five hundred twenty two crore, fifty lakhs, sixty five thousand (Rs.12,522,50,65,000), there was a total budgetary expenditure of Rupees Twelve thousand six hundred sixty two crore, ninety one lakhs, ninety four thousand (Rs.12,662,91,94,000), resulting in a budgetary deficit of Rupees One hundred forty crore, forty one lakhs, twenty nine thousand (Rs.140,41,29,000), which along with the deficit opening of Rupees Four crore, eighty six lakhs, thirty six thousand (Rs.4,86,36,000), resulted in a deficit closing balance of Rupees One hundred forty five crore, twenty seven lakhs, sixty five thousand (Rs.145,27,65,000) during the year 2003-04.

The emerging position reflects a marked improvement over the fiscal position reflected in the budget estimates for the same year, as presented to the State Legislature. This has been largely due to our continuing efforts to generate additional fiscal resources and to implement continuing economy measures.
 

II.
 

Efforts to generate additional resources and enforce economy in expenditure have resulted in the Budget /Estimates for 2004-05 being revised as follows:-

 

a)
 

The revised estimates for the year 2004-2005 reflect a deficit opening of Rupees One hundred forty five crore, twenty seven lakhs, sixty five thousand (Rs.145,27,65,000).

 

b)



 

Against a revised revenue receipt of Rupees One thousand seven hundred twenty one crore, forty four lakhs, sixty seven thousand (Rs.1,721,44,67,000), the revised revenue expenditure is Rupees One thousand six hundred seventeen crore, thirteen lakhs (Rs.1,617,13,00,000), resulting in a revenue surplus of Rupees One hundred four crore, thirty one lakhs, sixty seven thousand (Rs.104,31,67,000).

 

c)






 

Against a revised total budgetary receipts of Rupees Fourteen thousand six hundred seventeen crore, eighty three lakhs, fifty two thousand (Rs.14,617,83,52,000), the revised budgetary expenditure is Rupees Fourteen thousand five hundred eighty nine crore, ninety lakhs, ninety thousand (Rs.14,589,90,90,000), resulting in a closing deficit of Rupees One hundred seventeen crore, thirty five lakhs, three thousand (Rs.117,35,03,000) after adjusting the opening deficit balance of Rupees One hundred forty five crore, twenty seven lakhs, sixty five thousand (Rs.145,27,65,000).
 

III.
 

The Budget Estimates being presented today for the year 2005-2006, propose as follows:-
 

 

a)
 

An opening deficit balance of Rupees One hundred seventeen crore, thirty five lakhs, three thousand (Rs.117,35,03,000).

 

b)



 

A total revenue receipts of Rupees One thousand nine hundred seventy five crore, twelve lakhs, seventy six thousand (Rs.1,975,12,76,000), against a total revenue expenditure of Rupees One thousand eight hundred seventy five crore, seventy one lakhs, nine thousand (Rs.1,875,71,09,000), resulting in a revenue surplus of Rupees Ninety nine crore, forty one lakhs, sixty seven thousand (Rs.99,41,67,000).

 

c)






 

The total budgetary receipts during the year are estimated at Rupees Fourteen thousand nine hundred four crore, thirty four lakhs, twenty three thousand (Rs.14,904,34,23,000), against a total budgetary expenditure of Rupees Fourteen thousand eight hundred eighty five crore, sixty one lakhs, fifty seven thousand (Rs.14,885,61,57,000), resulting in an estimated closing deficit of Rupees Ninety eight crore, sixty two lakhs, thirty seven thousand (Rs.98,62,37,000), after adjusting the opening deficit of Rupees One hundred seventeen crore, thirty five lakhs, three thousand (Rs.117,35,03, 000).
 

VOTE ON ACCOUNT

Along with the Budget Estimates, I shall also be presenting a Vote-On-Account for covering expenditure during the first three months of the year 2005-06, for consideration of this august House.
 

NON-PLAN BUDGET 2005-06.
 

The Non-Plan Budget Estimates for 2005-2006 envisage an outlay of Rupees One thousand two hundred sixty eight crore, two lakhs and forty three thousand (Rs.1,268,02,43,000.00) which is 7.17 per cent lower than the likely non-plan expenditure of Rupees One thousand three hundred fifty eight crore, eighty eight lakhs, sixty eight thousand (Rs.1,358,88,68,000.00) during the current year. All possible efforts have been made to adequately provide for normal maintenance and recurring expenses, amortization of debts and liabilities and critical maintenance cost of normalized projects.  Fiscal measures to contain avoidable non-plan expenditure will continue, but critical and unavoidable segments of expenditure have been protected and sufficiently provided for as per terms and conditions of the MOU on fiscal reforms, extended between the State and the Central Government.
 

PLAN BUDGET 2005-06
 

The approved Tenth Plan outlay is Rs.3009.00 crores. The plan expenditure during 2002-03 and 2003-04 were Rs.400.04 and Rs.487.04 crores respectively. The revised plan outlay for the year 2004-05 based on available resources is Rs.679.00 crores.

The approved Annual Plan size of Rs.800.00 crores for 2005-06 is 15.12 per cent higher than the approved plan outlay of the current year. The budgeted outlay of Rs.800.00 crores includes a proposed outlay of Rs.187.59 crores for Pradhan Mantri Gramodaya Yojana (PMGY) which represents 23.45 per cent of the proposal size of the Annual Plan, 2005-06.
 

LAW AND ORDER
 

During the last one year, the law and order situation in the State has been by and large peaceful. Limited number of insurgency related crimes like armed robbery, dacoity, extortion, kidnapping for ransom and murder continue to be perpetrated by militant organisations. To meet such challenges, the State Government has augmented the strength of the police force by raising the 4th MLP Battalion and modernised the status of the State Police in terms of arms and ammunitions, communication equipments, vehicles, training, operational skills and intelligence gathering. The 5th MLP Battalion has recently been sanctioned by the Government of India and will be raised soon. Counter insurgency operations have been intensified and a large number of militants have been arrested and some have surrendered. Government has appealed to these militant organisations to come forward to discuss their grievances and refrain from meaningless violent activities, endangering peace and harmony, and adversely affecting the progress of development of the State and its people.

During July 2004, a tripartite agreement suspending armed operation for six months was signed at New Delhi by the Government of India, the State Government and the A'chik National Volunteers' Council. The suspension of armed operations was extended for a further period of six months by mutual agreement thereafter. Both sides agreed to set up a Joint Monitoring Group comprising of representatives of Government of India, the State Government, Army, CRPF and the  ANVC to oversee the suspension of operations.

Meghalaya has a 423 kilometers long porous border with Bangladesh. This has resulted in the long standing problem of infiltration of Bangladeshi nationals into the State. During the last three years, 10,571 Bangladeshi nationals have been detected in the State by the Police as well as members of the public. Most of them were pushed back across the border while a few were prosecuted. The porosity of the international border affords a good opportunity to the militant outfits of the State and the North Eastern region to move with impunity for carrying out militant activities with arms transshipment, training and establishment of base camps in Bangladesh. The Union Government has been apprised of the problem with requests to strengthen border management adequately. 

Government is also determined to maintain law and order. Though there has been no major communal problem in the State over the last one year, influx continues to be a serious concern of the State. Government is actively considering ways and means to tackle this problem. The State also shares a 566 kilometers long inter State boundary with Assam. Government is determined to sort out the boundary problems in the areas of difference with the Government of Assam, amicably, through the process of dialogue. 
 

SECTORAL DEPARTMENTAL PROGRAMMES.
 

AGRICULTURE INCLUDING HORTICULTURE
 

Agriculture continues to play a dominant role in the economy of the State. The current year is expected to end with a total foodgrain production of 2.45 lakh tonnes as against a total production of 2.31 lakh tonnes during 2003-04. The gross cropped area of 2.77 lakh hectares is expected to be increased to 3.20 lakh hectares by the end of the Tenth Plan period. A total of 78 watershed projects are proposed to be implemented during the Tenth Plan to cover all the 39 Community and Rural Development Blocks in the State. Though potato continues to dominate the commercial crop production, other horticultural crops like pineapple, banana, turmeric, tapioca and papaya have registered significant increase both in terms of area and production. Tea cultivation, which was earlier limited to only three districts, has now been expanded to cover the other districts of the State, as well. Major bottlenecks like marketing facilities, low productivity and quality of crops are being addressed through new initiatives under Technology Mission for Horticulture Development, which provides training and exposure of farmers to innovative technologies like drip irrigation and poly house cultivation etc. These interventions have resulted in appreciable improvement in the area coverage as well as productivity of horticultural crops. The State has also renewed its focus on low volume-high-value crops by launching an aggressive programme for popularizing the cultivation of strawberries, anthuriums, roses, brocoli, mushrooms and select spices.

Apart from the State Plan budget, the North Eastern Council has sanctioned an amount of Rs.335.48 lakhs for Citrus Rejuvenation and Development of Orange besides an amount of Rs.308.00 lakhs for Area Expansion of Strawberry in the State.
 

The plan outlay for the agriculture sector during 2005-06 has been proposed at a level of Rs.2034.00 lakhs as against a revised of Rs.1446.00 lakhs during the current year.
 

SOIL AND WATER CONSERVATION
 

On attaining Statehood, we inherited 1500.05 hectares of developed agricultural lands, 1053.96 hectares of afforested land, 102.3 hectares of land under erosion control works and 363 hectares under Cash Crop Development works. Our efforts during the last three decades for improved soil and water management have resulted in increase of agricultural land with assured irrigation to 48,393.80 hectares, land under afforestation to 30,476.19 hectares, land under Erosion Control works to 10,460.05 hectares and land under Cash Crop Development works to 10,805.77 hectares. Vigorous implementation of the Jhum Control Scheme has resulted in significant reduction of the number of Jhummia families to 51,428 at present.

Our sectoral focus will continue to be on Jhum Control as well as Watershed Management Schemes. An amount of Rs.300.00 lakhs has been earmarked under the Special Central Assistance for Watershed Development Project in Shifting Cultivation Areas.
The plan outlay under this sector during 2005 - 06 is of the order of Rs.1450.00 lakhs as against a revised outlay of Rs.878.00 lakhs during the current year.
 

ANIMAL HUSBANDRY AND DAIRY DEVELOPMENT
 

Efforts to achieve self-sufficiency in egg and meat production will continue. These efforts have resulted in decreased dependence on outside supplies of meat requirements in the State. Outside supplies of meat which accounted for 28.39 per cent of the total meat requirement during 2003-04 is expected to taper down to 22.46 per cent during the current year. Egg production which was 93.16 million during 2003-04, is expected to increase to 95.10 million by the end of the current year. Similarly, milk production which was 68.25 lakh tonnes during 2003-04 is expected to increase to a level of 78.60 lakh tonnes during the current year.

During the year, our sectoral focus will be on strengthening of infrastructure in all districts for enhanced animal health coverage and improved breeding facilities. Adequate funds will be earmarked under the scheme "Employment Generation for Educated Unemployed Youth' to enable them to take up poultry, piggery and dairy farming as their employment. In order to further enhance egg and meat production on a sustainable basis, we propose to launch the Rural Cluster Development Scheme during 2005-06.
 

The Plan outlay for this sector for the year 2005-06 has been proposed at Rs.1010.00 lakhs.
 
FISHERIES
 

Fish production in the State accounts for about 22.00 per cent of our annual requirement. Government will continue its efforts to encourage fish culture in the private sector by creating new water bodies for utilising wastelands which are unfit for agriculture and to provide self-employment opportunities to the people of the State. Inland fish production is likely to reach 6,000 metric tonnes during the current year as against a production of 5,147 metric tonnes during 2003-04. An amount of Rs.225.00 lakhs has been proposed for implementation of the "One Thousand Ponds" Scheme during 2005-06.
Against the sectoral  outlay of Rs.120.00 lakhs during the current year, the plan outlay for the year 2005-06 is proposed at Rs.400.00 lakhs.
 

COOPERATION
 

The Cooperative Movement in the State has gradually evolved and diversified. The movement has expanded to other areas like handloom and weaving, village industries, dairy, poultry, piggery, fishery, housing, food processing and transport apart from the traditional credit, marketing and consumer activities.

During the current year, attempts continue to address the problems of cooperatives and to improve their working conditions in order to ensure their overall growth. Proposals have been submitted to the National Cooperative Development Corporation for expansion of the Integrated Cooperative Development Project to cover all the seven districts in the State.

The Meghalaya Cooperative Apex Bank has been increasing its credit disbursement every year. Its credit dispensation during 2003-04 was of the order of Rs.4950.03 lakhs which is higher than the credit level of Rs.4205.49 lakhs during 2002-03. The Bank has created two cells - one at Shillong for the Khasi Hills region and the other at Tura for the Garo Hills region, for providing counselling and capacity building to the educated unemployed youth and budding entrepreneurs of the State. 
 

As against a revised outlay of Rs.534.00 lakhs for this sector during the current year, an outlay of Rs.578.00 lakhs is proposed during 2005-06.
 

FORESTRY AND WILDLIFE
 

Government will continue in its endeavour to enhance the forest cover and protect the existing wildlife of the  State. In pursuance of the Apex Court ruling, working plans for the Government forests have been prepared and working schemes for the forests under the control of the three Autonomous District Councils have been formulated for approval by the Government of India.

Forest Development Agencies have been constituted in each district of the State to channelise central assistance under the National Afforestation Programme to the Joint Forest Management Committees, to enable them to carry out afforestation programmes and provide employment to the rural poor. 73 Joint Forest Management Committees covering 15000 households have been formed so far. Government of India have approved projects for regeneration of forests including bamboo, cane and medicinal plants at an expenditure of Rs.925.04 lakhs during the remaining years of the Tenth Plan period.

During the Last three decades, the State has raised 1,06,187 hectares of plantation in degraded lands through its plantation regeneration programmes.
The plan outlay for 2005-06 under this sector has been proposed at Rs.1,218.00 lakhs.
 

COMMUNITY AND RURAL DEVELOPMENT
 

Government continues to attach importance to the Community and Rural Development sector for accelerating the economic and social development particularly of rural areas, with a view to improving the quality of rural life. Centrally sponsored programmes like Swarnjayanti Gram Swarozgar Yojana, Sampoorna Grameen Rozgar Yojana, Indira Awaas Yojana and Intergrated Wasteland Development Programme continue to empower the rural poor, enhance rural employment opportunities, create durable community assets and provide housing facilities to BPL families.

During the current year, 646 Self Help Groups (SHGs) were formed under Swarnjayanti Gram Swarozgar Yojana. 2,686 houses were constructed and 1,024 houses upgraded under Indira Awaas Yojana. 28.50 lakh mandays of rural employment were also generated under the Sampoorna Grameen Rozgar Yojana.

The State's performance and achievements of physical targets under various rural development schemes have been comparatively better during the current year. Consequently, we expect larger flow of Central funds during the next year. We are committed to match such flow of Central funds by timely release of the corresponding State share. Similar efforts will be made under the Old Age Pension, and the Family Benefit and Maternity Benefit Schemes to provide succour and support to the less fortunate sections of our society.

Under the Chief Minister's Special Rural Development Programme, Rs.400.00 lakhs has been proposed during 2005-06. The allocation for Special Rural Works Programme will be further enhanced during 2005-06. Under the normal Community Development Scheme, which has benefitted the rural populace over the years, through implementation of a number of sectoral projects, it is proposed to provide Rs.800.00 lakhs during 2005-06.
 

The plan outlay proposed for this sector during 2005-06 is Rs.7,053.00 lakhs.
 

BORDER AREAS DEVELOPMENT PROGRAMME
 

During 2003-04, an amount of Rs.705.00 lakhs was sanctioned as Additional Central Assistance by the Planning Commission for implementation of schemes in the border areas of the State. Schemes being implemented out of the aforesaid assistance include construction of school buildings, community halls, footpaths, footbridges, link roads, playgrounds, market stalls, water supply, ropeways, handloom and toilets.

During the current year, an amount of Rs.30.00 lakhs has been approved for providing scholarships to over 2,301 students hailing from the border areas. It is proposed to provide an amount of Rs.38.00 lakhs for this purpose during 2005-06 Border Area Programmes will continue to focus on construction of school buildings, ropeways, market stalls, community halls, footpaths and footbridges.
As against the revised outlay of Rs.602.00 lakhs during the current year, the proposed plan outlay for this sector during 2005-06 is Rs.650.00 lakhs.
 

MINOR IRRIGATION AND COMMAND AREA DEVELOPMENT
 

As of today, 176 surface water schemes and 10 ground water schemes have been completed in the State covering a total command area of 25,265.17 hectares. This represents around 12 per cent of the total irrigation potential of the State. It is expected that the recently created Directorate of Irrigation will realise the potential for accelerated agricultural growth. In order to ensure proper maintenance of created assets, it is proposed to raise additional resources by realising water rates from the beneficiaries of the projects in the command areas, through Water Users' Associations. The provision for Minor Irrigation sector has been increased from the level of Rs.744.00 lakhs during the current year to the proposed level of Rs.926.00 lakhs during 2005-06.
 

POWER
 

The State is committed to electrify all villages by the year 2007.  The programme for Rural Electrification is being undertaken with Central assistance under the PMGY. During 2004-05, an amount of Rs.3,650 lakhs was allocated for Rural Electrification. Planning Commission has provided an equal amount during 2005-06.

The State is not able to access the surplus power of the North Eastern Region due to transmission constraints and lack of grid connectivity. In order to meet the present power shortage of the State, a number of transmission schemes have been formulated. These include the tranmisson line from Sarusajai in Assam to Byrnihat in Meghalaya, Agia in Assam to Nangalbibra in Garo Hills, Silchar in Assam to Byrnihat via Shillong, and Misa in Assam to Byrnihat in Meghalaya. 

The work on the 84 MW Myntdu Leshka Hydro Electric Project is continuing on schedule. The project, at an estimated cost of Rs.363 lakhs is expected to be completed during 2007. Preliminary feasibility reports have been received from the Brahmaputra Board for Kynshi Hydro Electric Project and the Simsang Multi Purpose Hydro Electric Project. These Projects have a potential of over 650 MW. The MeSEB is also taking up investigation of a some more Hydro Electric Projects, namely the 25 MW Umiam Umtru Stage V HEP, the 150 MW Umngot HEP, the 25 MW Umngi HEP and 60 MW Myntdu Leshka Stage II HEP.

Under the Accelerated Power Development Reforms Programme (APDRP), MeSEB has initiated the reform process to ensure commercial viability and provide quality power in the State, by implementing Energy Audit and reducing transmission and distribution losses. Central Government have approved the APDRP Scheme at a total cost of Rs.18,190 lakhs, and an amount of Rs.2,113 lakhs has already been released. Work on the renovation and modernization of the 18 MW Umiam Stage II Power House will be taken up with J.B.I.C. funding.

The losses of the Board have been significantly reduced during 2003-04 and 2004-05, and the Board is expecting to achieve break even point during 2005-06.
 An allocation of Rs.21,300 lakhs is proposed for the sector during 2005-06 against an allocation of Rs.14,882 lakhs during 2004-05.
 

INDUSTRIES
 

Priority continues to be accorded to the development of industries in the State. While 21 industrial undertakings have been set up in the Industrial area at Umiam, 25 and 39 Industrial undertakings have been set up at the Export Promotion Industrial Park and the declared Schedule Industrial Area at Byrnihat and at Khanapara respectively. These undertakings have generated about 6000 job opportunities based on local resources. The Industrial Promotional schemes are implemented through the Meghalaya Industrial Development Corporation which extends escort and support services to Industrial units during their pre-investment, investment and post-investment stages. Industrial promotional activities include strengthening of the growth centre at Mendipathar, the Industrial Area at Umiam and the Industrial Estates located at Shillong, Jowai, Tura, Nongstoin, Williamnagar and Mendipathar. The Small Scale Sector has generated 28,398 employment opportunities through 4,905 registered Industrial Units. In order to encourage and support the growth of this sector, facilities available under the State Industrial Policy have been extended to the Small Scale Industries as well. 

The Meghalaya Khadi and Village Industries Board extended fiscal benefits available under the Rural Employment Generation Programme by way of margin money to the extent of 30 per cent of the project cost. The Meghalaya Handloom and Handicrafts Corporation has facilitated popularisation, marketing and sale of local handloom and handicraft products. 
 

The plan outlay under this sector has been proposed at Rs.2246.00 lakhs against the outlay of Rs.1744.00 lakhs during the current year.
 

SERICULTURE AND WEAVING
 
Development of 1118.00 of Mulberry, Eri and Tasar plantation have been supported for production of 3.38 lakh kilograms of mulberry and eri cocoons and 443.88 lakh kgs of muga cocoons which is expected to be achieved in this sector during the current year. The thrust in this sector will result in generation of self employment opportunities in rural areas. It is also proposed to impart training to 1,129 beneficiaries with a view to encouraging more sericulture farmers to take to systematic plantation for silkworm rearing and production of cocoons. The Catalytic Development Programme of the Central Silk Board will continue.
In the Handloom sector, it is expected to increase the production level of handloom fabrics to 65.60 lakh square metres during 2005-06, besides imparting training to 320 Progressive Weavers and 450 Silk Weavers. Special emphasis will be given to the implementation of the Integrated Handloom Training Programme and the Central Sector "Bunkar Bima Yojana" Scheme.
 
The proposed plan outlay under this sector for 2005-06 is Rs.340.00 lakhs.
 
MINING AND GEOLOGY
 
During the current year, eight geological investigation programmes on mineral exploration including investigation on ground water an geotechnical studies were conducted, besides geological mapping of 8.30 square kilometers and collection of 175 samples for chemical and petrological analyses.
The Tenth Plan target includes small and large scale mapping of a total area of 260.00 square kilometers, intensive drilling explorations covering 4,250 running metres and conduct of 3,500 sampling analysis.
An amount of Rs.8,888.00 lakhs is expected to be collected as revenue from major minerals during the current year and the anticipated collection during 2005-06 is estimated at Rs.9,850.00 lakhs.
 
The proposed plan outlay for this sector for 2005-06 is Rs.200.00 lakhs against an outlay of Rs.189.00 lakhs during the current year.
 
ROADS AND BRIDGES
 
The total plan investment made on roads and bridges since the inception of the State is Rs.1,15,220.00 lakhs. The total road length up to 2003-04 was 7,860 kilometers, out of which 4,555 kilometers are blacktopped and 3,305 are gravelled roads.  The road length during the current year will be increased to 7,934 kilometers with a road density of 35.37 km per 100 square kilometers.
The proposal for widening and improvement of a portion of the Bajengdoba-Tura Road has been included in the Annual Plan of the Ministry of Road Transport and Highways, Government of India during 2005-06. Improvement work on the above Highway is expected to commence during  the next financial year. Improvement work of the Guwahati-Shillong road is in good progress and is expected to be completed by December, 2005. A major portion of the improvement work on the Jowai - Amlarem - Dawki Road is also expected to be completed during 2005-06. Government accords priority to the development of the Shillong - Nongstoin - Tura State Highway, the Upper Shillong-Nongstoin part of which has been recently declared as a National Highway. The Ministry of Road Transport and Highways have entrusted the work for construction of the Shillong Bye-Pass to the National Highway Authority of India and the State is pursuing the matter with the Central Government.
Rural road connectivity is an important aspect of rural development. Schemes under the Prime Minister's Gram Sadak Yojana have been implemented in the State since 2000-01 and will be continued during 2005-06. Sixty villages are proposed to be provided with road connectivity during the next two years.
The proposed plan outlay for this sector during 2005-06 is Rs.11,094.00 lakhs against an amount of Rs.10,135.00 lakhs during the current year.
 
ROAD TRANSPORT AND OTHER TRANSPORT SERVICES
 
We will continue to assist Meghalaya Transport Corporation to build up its assets and reduce its pending liabilities to enable the Corporation to become a profit making organisation serving the people, throughout the State. Computerization of records in the offices of the State Transport Authority and the Regional Transport Authority would be accelerated with a view to providing better services to the people besides improving the revenue collection. The enforcement of the provisions of the Motor Vehicles Act would be further strengthened to reduce traffic congestion and ensure compliance by vehicles, particularly trucks.
 
SCIENCE AND TECHNOLOGY
 
Introduction of Appropriate Technologies has been taken up as a major programme under this sector during the Tenth Plan period. During the current year, a number of schemes like the Technology Initiation Programme, Technology Demonstration Programme and General Technology Popularisation Programme have been taken up in the State. Emphasis has also been given to societal intervention of science and technology in order to improve the quality of life of the common man. Construction of the Shillong Science Centre at the North Eastern Hill University campus under the auspices of the Ministry of Tourism and Culture is expected to be completed during the early part of 2005-06. An amount of Rs.10.00 lakhs will be released as State Government's contribution to the Centre during the current year.

 

TOURISM
 
Realisation of the tourism potential of the State through development of tourism industry, creation of tourist infrastructure and attracting tourists from India and abroad is being given due priority.  Besides the allocation for the State schemes, advantage will be taken of the Central schemes in order to make available sufficient funds, including the matching State share, wherever needed. With the recent settlement of the arbitration case concerning Crowborough Hotel, steps will now be taken for its completion and utilisation. The Meghalaya Tourism Development Corporation will be suitable assisted to make it a vibrant organization.
In order to support socio-culture and eco-tourism, various awareness programmes have been held at places of tourist importance to involve the local people in tourism promotion activities. In addition to the existing Tourist Information Centres, two new offices at Jowai and Baghmara and another Tourist Information Centre at Kolkata have been established.
 
An outlay of Rs.236.00 lakhs has been proposed for this sector during 2005-06 as against the outlay of Rs.220.00 lakhs for the current year.
 
CIVIL SUPPLIES
 
The scheme of Targeted Public Distribution System through which foodgrains are distributed to families below the poverty line will continue. The Central Sector Scheme of Antyodaya Anna Yojana covering 42,100 poorest of the poor families in the State at present, will also continue. An additional 13,500 families are expected to be covered under the scheme shortly. 'Annapurna', another Central Sector Scheme, covering 9,263 indigent beneficiaries above the age of 65 not covered by the National Old Age Pension Scheme will also continue. A total of 428 consumer dispute cases have been disposed of by the Consumer Courts in the State till date.
 
AUTONOMOUS DISTRICT COUNCILS
 
Support to the Autonomous District Councils in their endeavour to serve the indigenous people will continue. The programme for providing grants-in-aid to the Councils for rural communication, repairs and maintenance of Inspection Bungalows, improvement of rural markets will continue.
For this purpose, an outlay of Rs.550.00 lakhs is proposed during 2005-06.

 

EDUCATION
 
The Education Sector will continue to receive high priority. Appropriate steps will be taken to improve educational standards including facilities and service conditions of teachers. In order to meet the constitutional requirement of providing free and compulsory education to all children till they attain the age of fourteen, the State government has taken steps under the Sarva Shiksha Abhiyan to provide elementary education to children in the age group of 6-14 years. Attempts will be made to cover school less villages with population below 200, under the Education Guarantee Schemes  or the scheme for Alternative and Innovative Education.  
With a view to enhancing access to Secondary education in the uncovered areas, Government have accorded permission to open 157 Secondary Schools and 35 Higher Secondary Schools over the last two years. Special grants-in-aid for appointment of qualified Science Graduate teachers in 64 Secondary Schools have been extended. Grants have also been sanctioned for assistance to 8 private colleges in the State during the current year.
Information Technology Education is being provided in 36 Schools under the Eleventh Finance Commission Award. The proposal  for providing Computer Education in 59 Schools under the Modified Computer Literacy and Studies in Schools have been sanctioned. Some more Schools are being covered under the NEC Computer Scheme.
Under the World Bank assisted Technical Education III Project, two additional courses comprised of a three year Diploma Course in Computer Science and Engineering and a two year Post Diploma Course in Information Technology have been introduced. The two new Polytechnics at Jowai and Tura have become functional.
Teachers are a key resource in the reform, redirection and renewal of the educational system and their training is of crucial importance. During the current year, 341 Primary School teachers and 235 Upper Primary School teachers were trained at the Elementary Teachers Training Institutes while 34 Pre - Service Trainees attended the training programmes in the District Institutes of Education and Training. Four new District Institutes of Education and Training at Tura, Baghmara, Nongstoin and Nongpoh have been made operational. 610 teachers will be trained during 2005-06.
 
A Plan outlay of Rs.8,150.00 lakhs has been proposed for this sector during 2005-06.
 
ART AND CULTURE
 
Efforts to preserve and protect the rich cultural heritage of the State will continue. Special emphasis will be given to build up basic infrastructure for the preservation of cultural heritage and traditional art forms. Development of two galleries in the Williamson Sangma Museum has been taken up under the auspices of the Victoria Memorial Hall and the Indian Museum, Kolkata.
The Schemes of financial assistance to registered voluntary cultural organisations and festivals, and the Intensive Art and Culture Development Programme will also be continued.
An amount of Rs.670.00 lakhs is proposed for the sector during 2005-06.
 
SPORTS AND YOUTH AFFAIRS
 
Steps are being taken to augment the sports infrastructure at the State, District, Block and Village level. Schemes for construction of Outdoor and Indoor stadia, Indoor halls, Basketball Courts, Playfields will continue. Construction of the Gymnasium - cum - Indoor Hall at the Jawaharlal Nehru Stadium Complex sanctioned by the North Eastern Council has been taken up and is expected to be completed by the end of the Tenth Plan period.
An Additional Central Assistance amounting to Rs.300.00 lakhs has been allocated to this sector during the current year for completion of ongoing schemes.
An outlay of Rs.670.00 lakhs is proposed for this sector during 2005-06 against an amount of Rs.950.00 lakhs for the current year.
 
HEALTH AND FAMILY WELFARE
 
The Health and Family Welfare sector will continue to receive priority attention. During the current year, the focus has been on upgradation and strengthening of the health infrastructure, both in rural and urban areas. These efforts will continue during the next year. With a view to popularizing alternative modes of healthcare, one Homoeopathic Out Patient Department at Shillong Civil Hospital and 10 Homoeopathic Dispensaries covering all outlying district headquarters, besides one each at Mawkyrwat, Amlarem, Ampati and Chockpot have been set up. Three Ayurvedic Dispensaries have also been established.
A telemedicine Centre has been set up at the Shillong Civil Hospital with the assistance of the North Eastern Council. The Scheme will be extended to other District Hospitals under a second phase. Upgradation of the Shillong Civil Hospital with 200 additional beds is expected to be completed by September, 2005.
An Accident and Trauma Centre is being set up at Nongpoh with the assistance of the North Eastern Council. Government will endeavour to set up similar centres at Tura and Jowai.
 During 2005-06, The Government will stress on completion of ongoing schemes.
The proposed plan outlay for this sector for 2005-06 is Rs.4,484.00 lakhs against the outlay of Rs.4,442.00 lakhs during the current year.
 
WATER SUPPLY AND SANITATION
 
The Water Supply sector has the responsibility of supplying potable water to all habitations in the State. With the assistance available under the Central Schemes, which aim to provide water to rural and urban areas on an accelerated basis, the present momentum will be further stepped up. The Central Sector Scheme is under implementation in all Districts except Ri - Bhoi. Similarly the Central Sector Total Sanitation Campaign, which envisages commonly participation has been sanctioned for East Khasi Hills and West Garo Hills Districts. The remaining Districts will soon be covered under this Scheme. Also the ongoing Greater Shillong Water Supply Scheme will soon be completed. With increasing economic activity, water and air pollution have become a matter of concern and Meghalaya State Pollution Control Board would be assisted to enable it to play its role effectively.
Under the Prime Minister's Special Package, 442 hand pumps were installed, 446 schools were provided with water supply and 430 traditional water sources were revived during the current year. The Pilot Project under Sector Reforms in Ri-Bhoi District was successfully implemented in 36 habitations and 50 schools. The beneficiary community and school authorities have since taken over the responsibility for operation and maintenance of the schemes.
Schemes under the Centrally Sponsored Accelerated Urban Water Supply Programme intended for providing water supply to towns having a population of less than 20,000 have been taken up at Williamnagar and Baghmara. The scheme at Baghmara is likely to be completed during the current year. The target to cover 387 Non covered or Partially covered habitations and 70 rural schools under Rural Water Supply Programme during the current year is likely to be achieved. 
 
A plan outlay of Rs.4,300.00 lakhs is proposed for this sector during 2005-06.
 
URBAN DEVELOPMENT
 
Rapid urbanization of the State has put a huge burden on the available civic amenities. The provision under the State Plan for this sector has been enhanced from Rs.2,175.00 lakhs during the current year to a proposed level of Rs.2,503.00 lakhs during 2005-06. It is proposed to take full advantage of the Central schemes for creation of urban infrastructure through construction of parking lots, marketing complexes and renovation of existing infrastructure. The new Shillong Township Project has been planned to decongest Shillong urban agglomerate and require resources would be made available for preliminary work. Schemes under the Environmental Improvement of Urban Slums, the National Slum Development Programme and the Swarna Jayanti Shahari Rozgar Yojana will continue. The project for construction of a shopping complex at Polo Bazar, Shillong, has been taken up during the current year.
An amount of Rs.100.00 lakhs has been provided under the Chief Minister's Special Urban Development Fund in the Budget Estimates for 2005-06. The Special Urban Works Programme will continue with increased outlays.
Against the approved outlay of Rs.2,175.00 lakhs during the current year a plan outlay of Rs.2,503.00 lakhs is proposed for this sector during 2005-06.
 
LABOUR AND EMPLOYMENT
 
Steps will be taken for expeditious implementation of projects for construction and renovation of departmental buildings at Shillong, Tura and Baghmara. Students will continue to be sponsored against seats provided by Government of India in different trades. The Employment Exchange Live Register indicate that there are 36,623 job seekers presently registered in the State.
An amount of Rs.250.00 lakhs has been proposed for this sector under plan during 2005-06.
 
SOCIAL WELFARE AND NUTRITION
 
A new scheme under "The Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995" has been implemented during the current year and 569 beneficiaries were extended the benefits of Uniform Grants, Book Grants, Conveyance Allowance and Unemployment Allowance. In addition, 159 physically handicapped persons were supported for vocational training, 250 physically handicapped students were brought under the Scholarship Scheme and 125 aged destitutes were provided with grants.
The Supplementary Nutrition Programme for Children and Expectant and Nursing Mothers covering 2,25,468 and 10,580 beneficiaries in rural and urban areas, respectively, and the support extended to malnourished children under PMGY will continue to be implemented in all the Community and Rural Development Blocks of the State.
In pursuance of the action plan outlined in the Policy Document on Women's Empowerment, efforts are being made for convergence of women's development programmes with Non-Government Organisations in the State.
A plan outlay of Rs.3,384.00 lakhs is proposed for this sector during 2005-06 against Rs.2,748.00 lakhs last year.
 
GENERAL ADMINISTRATION
 
The Meghalaya House at Vellore and the Yojana Bhawan in Shillong have been made functional during the current year. Attempts will be made to expedite the construction of the new Meghalaya Legislative Assembly, the State Convention Centre, the new Meghalaya House at Mumbai, the second Meghalaya House at Vasant Vihar, New Delhi and to complete the Circuit House at Nongstoin. Steps will also be taken to develop the land at Hengrabari, Guwahati allotted by the Government of Assam. Attempts are being made for an Out - of - Court settlement with M/s Asian Housing Construction Ltd to conclude the ongoing arbitral proceedings relating to the construction of the proposed commercial office-cum-commercial complex at Nandlal Poddar Sarani Kolkatta. The proposal for construction of the Governor's Guest House at Tura is under process.
 
INFORMATION TECHNOLOGY
 
The Information Technology Policy, 2004 has been notified. Steps have been taken to set up an IT Park in the State by Software Technology Parks of India. A State level remote sensing and GIS network.
As part of the Common Minimum Programme, the National -Governance Action Plan will be implemented during 2005-06 through an IT Society. Training and capacity building of State Government Employees in IT skills will be taken up during the next year.
A plan outlay of Rs.200.00 lakhs is proposed during 2005-06.
 
INFORMATION AND PUBLIC RELATIONS
 
Adequate steps will be taken to project, promote and publicise the potential of the State at the regional, national and international level. The Special Interactive Programme has been launched this year, and Publicity Campaigns on area-specific issues will be undertaken in the District Headquarters, as well as in the rural areas of the State, where the villagers will be able to interact directly with Government functionaries at the field level.
A plan outlay of Rs.150.00 lakhs is proposed for this sector during 2005-06.
 
VALUE ADDED TAX
 
The Meghalaya Value Added Tax Act, 2003 (Act 2 of 2005) will be brought into effect from 1st April, 2005. VAT is a multi-point system of taxation with provision for full set-off for the input tax and the tax on previous purchases. The Government of India has agreed to compensate the States to the extent of 100 per cent of their revenue losses during the first year of implementation of VAT, 75 per cent during the second year and 50 per cent during the third year. Government has taken the required steps for computerization and strengthening of manpower to facilitate the transition to the new regime. With the support and cooperation from all sections of this august House, it is expected that the new tax system will bring the desired revenue growth for the benefit of  the State. It may be added that the Meghalaya Sales Tax Act, the Meghalaya Finance (Sales Tax) Act and the Meghalaya Purchase Tax Act have been subsumed under the new VAT Act.
 
BUDGET ACTUALS, 2003-04
 
The year 2003-04 opened with a deficit of Rupees Four crore, eighty six lakhs thirty six thousand (Rs.4,86,36,000). While the total receipts during the year, including receipts under Public Accounts, amounted to Rupees Twelve thousand, five hundred, twenty two crore, fifty lakhs, sixty five thousand (Rs.12,522,50,65,000), the corresponding expenditure was Rupees Twelve thousand, six hundred, sixty two crore, ninety one lakhs, ninety four thousand (Rs.12,662,91,94,000), resulting in a closing deficit of Rupees One hundred forty five crore, twenty seven lakhs, sixty five thousand (Rs.145,27,64,000).
 
REVISED ESTIMATES, 2004-05
 
The revised estimates for the current year reflects an opening deficit of Rupees One hundred forty five crore, twenty seven lakhs, sixty five thousand (Rs.145,27,65,000). While the revised estimated receipts for the year including receipts under Public Accounts are likely to amount to Rupees Fourteen thousand six hundred seventeen crore, eighty three lakhs fifty two thousand, (Rs.14,617,83,52,000), the corresponding expenditure is likely to amount to Rupees Fourteen thousand, five hundred, eighty nine crore, ninety lakhs, ninety thousand (Rs.14,589,90,90,000) resulting in an anticipated deficit of Rupees One hundred seventeen crore, thirty five lakhs, three thousand (Rs.117,35,03,000).
 
BUDGET ESTIMATES, 2005-06
 
The estimates envisage an opening deficit of Rupees One hundred seventeen crore, thirty five lakhs, three thousand (Rs.117,35,03,000), and total receipt including receipts under Public Accounts of Rupees Fourteen thousand nine hundred four crore, thirty four lakhs, twenty three thousand (Rs.14,904,34,23,000), against a corresponding expenditure, including expenditure on Public Accounts, of Rupees Fourteen thousand eight hundred eighty five crore, sixty one lakhs, fifty seven thousand (Rs.14,885,61,57,000), resulting in an anticipated closing deficit of Rupees Ninety eight crore, sixty two lakhs, thirty seven thousand (Rs.98,62,37,000).
 
ADDITIONAL RESOURCE MOBILISATION
 
With a view to suitable overcome the imbalances arising out of increasing revenue expenditure, increasing debt-service burden and spiralling establishment cost due to recurring increase in the level of Dearness Allowance of Government employees, it is essential to mobilize additional resources in conformity with the Medium Term Fiscal Responsibility Programme, mutually drawn up between the State and the Central Government. However, keeping in view the introduction of VAT w.e.f. 1st April, 2005 wherein all other types of taxes on sales are being subsumed, I do not consider it appropriate to propose any additional or fresh tax measure at this juncture. I, therefore, propose to generate some additional-resources by resorting to the following measures -
 

1)
 

Imposition of limited water user charges on water made available for irrigation as per rates to be specified in the legislation to be enacted.

2)

 

To introduce the Meghalaya Fiscal Responsibility Bill to enable the State to qualify for the additional resources recommended by the Twelfth Finance Commission Award as soon as the Bill is passed and assented to by Competent Authority.

3)
 

To streamline the tax, duty and royalties collection network with a view to suitably plug possible leakages and generate additional resources.

4)

To step up and augment measures for recovery of recoverable State dues.

5)

 

The aforesaid measures are likely to generate additional resources exceeding Rs.20.00 crore during 2005-06.
 
CONCLUSION
 
In conclusion, it is expected that with the gracious support and cooperation of all Hon'ble Members of this august House, the Budget proposals that I have presented today, are unanimously carried to create conditions harmonious to accelerated development and growth of the State economy, to meet the aspirations of the people of the State.

With these words, may I, Mr. Speaker, Sir commend the Budget proposals for the esteemed consideration of this distinguished House.
 
 
 

KHUBLEI
 

 

MITELA
 

 

JAIHIND