National Emblem
Government of Meghalaya
Budget Speech
1989-90
By

Shri. Purno A. Sangma

Chief Minister
Meghalaya
27th March, 1989
Mr. Speaker Sir,

        I rise to present the Budget Estimates for the year 1989 - 90.

National Economy

        At the national level, the past year was marked by sustained economic recovery. The adverse effects of the drought notwithstanding, the national economy recorded a high rate of growth during 1988-89. Agricultural production is likely to register an increase of over 17 per cent and foodgrains production is expected to exceed the target of 166 million tonnes. Unlike earlier post-drought years, industrial production recorded strong growth during 1988-89. A growth rate of over 9 percent was achieved in this sector during the period ending November, 1988. The impressive growth on the industrial front was complemented by the encouraging performance of key infrastructure sectors such as coal, steel, cement, fertilizers, railways and power generation.

        The strong inflationary pressures generated by the drought in 1987-88 were contained and the annual inflation rate was brought down to about 5 per cent by the end of January, 1989. The balance of payments situation, however, remains difficult. Though the rupee value of exports increased by over 24 per cent upto December 1988, the import bill grew at an even higher rate due primarily to the shortfall in foodgrains production, high demand growth and the sharp increase in the international prices of metals and chemicals.

State Economy

        In the State, the year was characterised by more vigorous efforts to hasten the pace of economic development. The State Domestic Product, estimated at Rs.310.21 crores in 1985-86, rose to Rs.345.18 crores in 1986-87, registering a rate of growth of 11.3 percent. Further improvement in the rate of growth is expected in 1987 - 88.

        Despite the heavy rains and the successive waves of floods and the extensive damages caused thereby to standing crops, foodgrains production during the year is expected to exceed the target of 150 thousand tonnes.

        The Industrial base of the State continues to be weal. There has been an encouraging increase, however, in the number of small scale industrial units. From a level of 671 in 1985-86, their number went up to 802 in 1986-87 and further to 970 in 1987-88. The number of persons employed by these units also registered an impressive  increase during this period.

        As in other parts of the country, the prices of essential commodities registered some  increase during the year. The wholesale price of rice went up by 4.7 per cent as compared to 4.5 per cent in the preceding year. Sugar prices increased marginally. Increases were observed also in the retail prices of mustard oil and vanaspati.

Planning

        As the Hon'ble Members are aware, the Seventh Five year Plan comes to an end in 1989-90. The next year is thus the last year of the Seventh Plan. Particular significance is therefore attached to the size of the Annual Plan for 1989-90. It is a matter of satisfaction that the outlay for the Annual Plan for 1989-90 has been fixed at Rs.150 crores representing an increase of over 15 per cent over the current year. The total outlay for the Seventh Plan will thus us Rs.556 crores against the original approved outlay of Rs.440 crores.

        While seeking to promote balanced growth, the 1989-90 Plan lays emphasis on the implementation of area-specific and beneficiary-oriented anti-poverty programmes for the benefit of the weaker sections of society. Greater stress will be laid on improvement in productivity, efficiency in the use of resources and the timely completion of the various ongoing projects in order to realise the benefits of investments made in the past.

        The District Planning and Development Councils, constituted in pursuance of the  Government's decision to decentralise the planning process, have started playing an active role in the formulation of district level plans. The Councils will also be involved in the exercises leading up to the preparation of the Eighth Plan programmes for the districts.

Agriculture

        In keeping with the importance due to agriculture in a predominantly agrarian State, the Annual Plan outlay for this sector for 1989-90 has been stepped up to Rs.677.00 lakhs, representing an increase of 30 per cent over the outlay for the current year. Against an anticipated production of 160 thousand tonnes in the current year, the foodgrains production target for 1989-90 has been fixed at 175 thousand tonnes. Necessary support in the form of seeds, fertilizers and scientific methods of cultivation will be extended to ensure the achievement of this target.

        Greater emphasis will be laid on the development and increased production of commercial crops, in particular, potato, ginger, turmeric, oil seeds and spices. Improved and high yielding variety seeds and chemicals and equipments for plant protection will be provided at subsidised rates to interested farmers. Efforts will also be made to ensure remunerative prices to growers by the establishment of regulated markets.

        The development of horticultural crops is another area to which considerable importance is attached by the Government. The Horticultural Development Programme will be constituted in 1989-90 with a higher outlay. As part of Government's efforts to popularise horticulture growers will be given 50 per cent subsidy in the supply of quality planting materials. Training in fruit processing will also continue to be imparted to youths and housewives.

Cooperation

        The cooperative movement has an important supporting role in the development of agriculture in the State. As multipurpose units, Primary Agriculture Cooperative Societies can not only provide credit support to cultivators but can also cater to their marketing requirements. The success of these societies is, therefore, crucial to the well-being of the farming community, the Integrated Cooperative Development Project, which is aimed at the development of these societies and has been started a pilot project in the East Khasi Hills District, assumes considerable importance in this context. At the State Level, the Cooperative Apex Bank maintained the flow of credit for agricultural operations.  Following its linkage with the Integrated Rural Development Programme, it has stepped  up its operations in the sphere of medium-term loans.

        The Crop Insurance Scheme has been making steady progress. During the Kharif 1987 season, 1,225 farmers, of whom 1,140 were small and marginal farmers, were covered by the scheme. During the Kharif 1988 season, the coverage increased to 2,640 farmers. The sum insured has also registered substantial improvement. In the field of marketing, arrangements were made by the State Cooperative Marketing Federation (MECOFED) in association with the Cotton Corporation of India for the procurement of cotton from the Garo Hills. Despite constraints of resources, the Federation is continuing its efforts to ensure remunerative prices to the growers of different agricultural produce.

Rural Development

        With a view to reduce the incidence of poverty and improve the quality of life in the rural areas, a number of programmes has been implemented with financial assistance from the Central Government. Mention may be made here, among others, of the Integrated Rural Development Programme (IRDP), the National Rural Employment Programme (NREP) and the Rural Landless Employment Guarantee Programme (RLEGP). Targeted at specific beneficiary groups, these programmes have benefited a large number of families while creating productive and durable assets for the community. During 1989 - 90, the coverage of these programmes will be expanded to benefit more families. Under IRDP alone, 6,000 new families are proposed to be covered in the coming year.  The Government of India has recently announced a scheme called the Jawahar Lal Nehru Rojgar Yojana for the benefit of the unemployed. In Meghalaya, the scheme will be implemented in the West Garo Hills district with an initial outlay of Rs.88 lakhs. A State Institute for Research and Training in Rural Development (SIRD) has been set up with Central assistance under the EEC Aid Programme. The Institute, which will become operational shortly, will impart training to Block and Village Level Workers engaged in the task of rural development.

Animal Husbandry and Veterinary

        In the animal husbandry sector, the emphasis is on the improvement of livestock and poultry and the supply thereof to the rearers. A notable achievement in this regard is the setting up of the Regional Pig Breeding Farm at Kyrdemkulai. Set up with assistance from the North Eastern Council, the Farm, when fully functional, will cater to the need of pig rearers not only in the State but also in other States in the North East. Steps will be taken also to ensure adequate health coverage; with this end in view, the chain of veterinary dispensaries and aid centres is being expanded.

Forests

        The rapid depletion of the forest wealth of the State is a matter of serious concern to the Government. It is imperative but steps should be taken not only to contain the damages but also if possible to undo it. A massive afforestation programme is proposed to be taken up on available barren lands with the active cooperation of the people. 5,260 hectares of plantations are proposed to be created in this manner during 1989-90. Preliminary works for another 18,000 hectares will also be undertaken during the year. At the same time, efforts to preserve and protect habitat for wild life will be intensified. A Biosphere Reserve has been set up at Nokrek and steps will be taken to develop it by means of proper management plans.

Soil Conservation

        The problem of soil erosion arising from the destruction of the forest cover is another area of concern for the Government. Apart from deforestation for commercial purposes, substantial losses are caused by agricultural practices such as shifting cultivation, or jhumming. One of the important objectives of the Soil Conservation Department, therefore, is the rehabilitation of jhummias. In this context, the scheme for Control of Shifting Cultivation, funded fully by Central assistance, is of crucial importance. Spread over a five-year period ending in 1991-92, the scheme seeks to wean away 2,252 jhummia families. An outlay of Rs.130 lakhs is proposed for the scheme in 1989-90. Under the cash crop plantation programme, encouraging response has been received from the jhummias especially in the Garo Hills districts in regard to the cultivation of rubber. Useful work on rubber plantation development has been undertaken also by the Rubber Board of India.

        Measures aimed at soil conservation in watershed areas, including mini and micro watershed, will be continued by the department. Mention may be made in particular of the Umtongphar Watershed Management Scheme, sanctioned at a cost of Rs.134.93 lakhs, for which assistance will be available from the North Eastern Council on a 50:50 basis.

Fisheries 

        Considering the importance of fish in the dietary habits of the people of the State, Government are anxious that the production of fish should be increased adequately. To ensure the achievement of this objective, a two pronged approach is being followed. On the one hand, facilities are being developed for increased fish seed production. Thus, three new fish seed farms, two in West Khasi Hills and one in West Garo Hills, have been set up. Work on a Regional Fish seed Farm at Jamge in East Garo Hills has also been taken up. At the same time, direct development of pisciculture is being attempted in suitable reservoirs of the State. With the assistance of the North Eastern Council, a scheme has been taken up for the reclamation and development of Tasek Lake. Private pisciculturists are also being given financial assistance for the construction and development of fishery ponds.

Industries

        On the industrial front, the launching of the Industrial Policy in May, 1988 was a major landmark. As announced in the Policy, a package scheme of incentives has been offered and a provision of Rs.75 lakhs has been earmarked in 1989-90 for the purpose. I am confident that local tribal entrepreneurs will take full advantage of the scheme. The Government also wish to avail the scheme recently introduced by the Government of India for the setting up of a growth centre. To be equipped with infrastructure of a very high quality, the growth centre will cater to the needs of medium and small scale industries. An exercise has been undertaken to decide on the location of the centre.

        The Tantalum Capacitator Project of the Meghalaya Electronics Development Corporation has commenced production. The Corporation will widen the area of its operation to take up development activities for electronic industries in the State. Other projects which are in different stages of implementation are the Paper Grade Lime Plant at Lumshnong and the Cement Plant at Siju. A draft report for the reactivation of the Mawmluh Cherra Cement Limited has been received. A share capital contribution of Rs.80 lakhs will be made by the Government to enable the company to raise funds for this purpose. As in previous years, the Meghalaya Industrial Development Corporation will assist local entrepreneurs to set up industries in the State. 946 units have so far been provided with financial assistance amounting to Rs.1,928.31 lakhs. In 1989-90, Rs.500 lakhs will be provided as assistance to 140 units. Training programme for developing local entrepreneurship and generating local manpower will also be continued.

Sericulture and Weaving

        Sericulture and Handloom Weaving are two important cottage industries of the State. With their potential for generating additional income and employment, they can contribute to an improvement in the living standards of the people particularly in the rural areas. In the sphere of sericulture, the Department's thrust is on increasing the production of cocoons. Emphasis has been laid both on the improvement of existing plantations and the development of new ones. In 1989-90, hectares of existing Mulberry and Eri plantations will be improved, besides bringing 200 hectares under additional coverage. In the light of the increasing demand for handloom fabrics, production facilities are being strengthened and greater stress is being laid on quality and better designs. Two new Handloom Development Centres were set up during the year, with one more planned for 1989-90. The number of Mobile Demonstration Units is also being increased.

Power

        In the power sector, work on the Umiam-Umtrew State IV Project made further progress. The first unit of 30 MV is expected to be commissioned by December 1989, while the second is expected by March 1990. The rural electrification programme has shown some improvement in the recent past. The current year's target of 200 villages is expected to be fully achieved. However, the total number of villages electrified so far remains low at 1732, constituting 38 percent of the total number of villages in the State.

        Along with the development of conventional sources of energy, work is continuing on the harnessing of various non-conventional energy sources. Ten solar heating systems of varying capacities have already been commissioned and the installation of six more energy generators is in progress. As part of a crash programme, 180 solar photovoltaic domestic light systems have been installed in schools and community halls in different parts of the State. Construction of bio-gas plants has also been undertaken.

Roads and Bridges

        Next only to the power sector in terms of outlay, road construction activities have always claimed a major share of the Annual Plan outlays of the State in the recent years. In 1989-90, an outlay of Rs.22 crores will be earmarked for the road sector. The next year being the last year of the Seventh Plan, emphasis will be laid on the completion of spill-over schemes from the Sixth Plan and on-going schemes sanctioned during the first four years of the Seventh Plan. As for new schemes, priority will be given to cases where land is made available free of cost. The total road length in the State is expected to go up to 5,619 Km. by the end of 1989-90, with the road density increasing to 25.05 Km. per 100 Sq. Km.

Transport and Communication

        In the absence of other means of communication, the road transport system assumes particular importance in Meghalaya. By linking in rural hinterland with over areas, the Meghalaya Transport Corporation has been playing a useful role in the economic development of the State. The Corporation, which now operates on 45 routes, has increased its route mileage to 5,458 Km. The recently completed Central Workshop will enable the Corporation to improve fleet utilisation and thereby its services. Though the functions of the Transport Department are mainly regulatory, it has been extending financial assistance to operators belonging to the Scheduled Castes and Scheduled Tribes for the purchase of vehicles. The scheme, which has benefited 32 operators so far, will be continued in 1989-90.

        As in previous years, the Communication Department will continue its dialogue with the Central Government for improvement and upgradation of the postal telecommunications facilities in the State. An effort will be made in particular to see that telephone facilities are extended to all sub-divisional headquarters which are not so provided so far.

Mining and Geology

        The Mining and Geology Department continued its investigations into the incidence of deposits of different minerals, among them limestone, coal and Kaolin. The Department will take  steps shortly to collect the cess on minerals.

Education

        As the Hon'ble Members are aware, a White Paper on Education was laid on the Table of the house in April, 1988. In pursuance of the policies contained therein, necessary follow-up action has been initiated in major thrust areas. The issue of the 10+2 system as also the vocationalisation of education at the +2 state have been considered and it is expected that the switch over to the new system will be effected in the next financial year as indicated in the White Paper, the revised UGC scales of pay have been extended to the teachers of deficit colleges. Teachers and non-teaching staff of such colleges have been given the benefit also of other allowances as admissible to Government employees.

        In the field of primary education, a massive programme for the construction of 1000 school buildings has been undertaken with the help of the award of the Eighth Finance Commission. While some of the buildings are expected to be completed by the end of the current year, the majority will be ready during the early part of 1989-90.

        In the matter of technical education, the Government will continue to arrange for the placement of local candidates in engineering institutions in different parts of the country. In its efforts to mitigate the problem of technical man power shortage in the State, the Department will also strengthen the facilities at the Shillong Polytechnic.

Sports and Youth Affairs

        The improvement of sports infrastructure is engaging the attention of the Government. An important step in this direction was the recent inauguration of the first phase of the Sports Complex  at the Polo Grounds, Shillong. Work has been taken in hand also on a stadium at Mawkyrwat. For the rural areas of the State, Rural Sports Centres are planned. Of these, two, one at Mawryngkneng and the other at Tikrikilla, have since been inaugurated. To commemorate forty years of the country's independence, Freedom Forty Runs were held in the State capital and in various district headquarters. To encourage young boys and girls to improve their performance, coaching camps were organised in different disciplines. Promising sports talents were admitted to schools run by the Sport Authority of India.

Health and Family Welfare

        Health care facilities are an important component of the Government's Social services programme. In accordance with the national policy, the Government's objective is to achieve "Health for all by 2000 AD". A three-tier health care system, consisting of sub-centres and primary health centres at the primary level, community health centres at the Secondary level and district hospitals at the tertiary level, is envisaged. During the first four years of the Seventh Plan, 134 sub-centres and 27 primary health centres have been established. During 1989-90, construction of 70 more sub-centres and 6 primary health centres will be taken up, besides continuing with the ongoing work on 3 community health centres.

        While catering to general health care, the need for provision of specialised services has not been lost sight of. A Cobalt Therapy Unit was commissioned during the year at the Shillong Civil Hospital. An Orthopaedic and Traumatology Centre will also be made operational shortly at the Shillong Civil Hospital.

        The Department will continue to implement the support programmes, among them the National Malaria Eradication Programme, the National TB Control Programme and the National Leprosy Programme. While strengthening the health infrastructure, due attention will be given also to manpower and personnel requirements.

Public Health Engineering

        The Government is committed to the provision of potable drinking water to the people of the State. By the end of March, 1988, 2429 villages had been provided with safe drinking water. During the current year, another 700 villages are expected to be so provided. In 1989-90, 760 more villages will be covered. Under the auspices of the Technology Mission of the Government of India, rain water harvesting schemes have been taken up in the West Khasi Hills District. The Programme will be extended to other districts in the coming year. In the urban sector, work is continuing of the design of a new distribution system for the Greater Shillong area. The consultant's report is expected by June, 1989.

Tourism

        With a view to tap the immense tourist potential of the State, a month-long Autumn Festival featuring a variety of events was organised. One of the highlights of the Festival was the inauguration of the Water Sports Complex and the Orchid Lake Resort at Umiam. Another notable achievement was the commissioning of the Tourist Bungalow at Tura. During 1989-90, a number of ongoing schemes, among them the Crowborough Hotel, are slated for completion.

Housing

        A new Housing Policy was adopted by the Government in April, 1988. In pursuance thereof, a new housing scheme for assistance members of the economically weaker sections and the low income group has been introduced. Under the scheme, subsidy will be given to the extent of 35 percent on the cost of certain element of subsidy.

        An outlay of Rs.165 lakhs was earmarked for the scheme during the current year. Assistance was rendered to members of the low income group under the Department's continuing schemes also. Members of the middle income group too benefited from the Department's loan schemes.

Social Welfare

        The needs of the aged, the destitute and the young are catered for the Social Welfare Department. A number of schemes is being implemented for the welfare of these groups. Three training centres are being run for the benefit of destitute women in need of care and protection. These centres, located at Shillong, Tura and Jowai, will continue to provide instruction in trades such as knitting, tailoring and weaving. For the benefit of juvenile delinquents, the Shillong Juvenile Jail has been converted into a Children's Home. Destitute children are being provided with food, shelter and education also under a scheme of the Central Government. Another scheme designed for the welfare of children is the Supplementary Nutrition Programme. In 1989-90, 85,200 children will be benefited by the scheme.

District Councils

        Although the District Councils are autonomous bodies, they depend largely on Government assistance for the implementation of development schemes in their respective jurisdictions. Grants are sanctioned to the Councils both on Plan and Non-Plan accounts. During 1989-90, Rs.70 lakhs will be sanctioned on Plan account, while Rs.30.45 lakhs will be provided on Non-Plan account.

Municipal Administration

        In the interest of better administration, adhoc Committees were constituted for the Municipalities at Shillong and Tura. As in the past, financial assistance was extended to these bodies for discharge of their normal functions and for undertaking developmental work. The assistance will be continued in 1989-90.

Border Areas Development

        The Government are fully alive to the problems faced by the people living in the areas bordering Bangladesh. It is essential not merely to halt further deterioration in their economic condition, but to actually speed up the tempo of  their economic development. With this objective, a number of schemes has been under implementation. The Border Areas Department will continue these schemes in the next year.

Programme Implementation

        Effective monitoring of the implementation of Plan Schemes is an important prerequisite of the planning process. In conformity with the policy adopted in this regard at the national level, a full-fledged Department of Programme Implementation now functions at the State level. Entrusted with the task of monitoring the progress of Plan Schemes, the Department is involved also in the setting up of a computerised data base in the State with the assistance of the National Informatics Centre. When commissioned, the NICNET, as it is called, will facilitate instantaneous exchange of data between the State and district headquarters.

Other Programmes

        I have given a broad outline of the policies and programmes of the Government for 1989-90. The Plan Supplement will provide the details of the various schemes proposed to be implemented during the year.

Ninth Finance Commission

        Before I proceed to the estimate, I wish to refer briefly to the First Report on the Ninth Finance Commission covering the year 1989-90. As the Hon'ble Members are perhaps aware, the Report was submitted in July 1988 and its recommendations were accepted by the Government of India in September, 1988. Unlike previous Commissions, the Ninth Finance Commission has adopted a normative approach to the assessment of receipts and expenditures. It has made no separate provision for the payment of salaries and allowances on the revised scales of pay effective from 1st January, 1987. The result is that even by the conservative estimate, the Government is left with an uncovered gap of over Rs.40 crores on Non-Plan revenue account.

        Having regard to the difficulties which could arise on this account in 1989-90, I took up the matter immediately with the Chairman of the Commission. The matter was also discussed with the Chairman and the Members during their visit to the State on the 18th February, 1989. The Commission was of the opinion that the prescribed norms were adequate and the State Government would be able to balance its revenue budget if the said norms were adhered to. It is our considered view, however, that the norms, particularly in respect of expenditure, are too stringent to be capable of practical application in the conditions obtaining in Meghalaya. It is hoped that the Commission will take not of our difficulties and do justice to the State in its final report for the period 1990-95.

Actuals, 1987-88

        During 1987-88, receipts on all account amounted to Rs.1,48,291.02 lakhs, resulting in a deficit of Rs.521.40 lakhs. Together with the negative opening cash balance of Rs.1,678.06 lakhs, the year closed with a deficit of Rs.2,199.46 lakhs. However, at the end of the year, the State Government had an amount of Rs.4,095.50 lakhs invested in Government of India Treasury bills.

Revised estimates, 1988-89

        The year 1988-89 thus opened with a negative cash balance of Rs.2,199.46 lakhs and a positive balance of Rs.4,095.50 lakhs in the Treasury bills account. Inclusive of the entire holdings in Treasury bills, total receipts during the year on all accounts are estimated at Rs.1,65,649.02 lakhs while expenditure is estimated at Rs.1,61,493.28 lakhs resulting in a surplus of Rs.4,155,74 lakhs. This surplus will not only wine up the entire negative opening balance but also leave a positive balance of Rs.1,956.28 lakhs. The balance would have been much lower, however, had the full impact of salary revision been felt in the current year.

Budget estimates for 1989-90

        The year 1989-90 is expected to open with a cash balance of Rs.1,956.28 lakhs. During the year, the deposits and expenditure on revenue account are estimated at Rs.31,265.06 lakhs and Rs.27,710.57 lakhs respectively, leaving a surplus of Rs.3,554.49 lakhs. Outside the revenue account, the estimated receipts and expenditure are Rs.1,36,485.78 lakhs and Rs.1,43,597.86 lakhs respectively, leaving a deficit of Rs.7,112.08 lakhs. However, the revenue surplus of Rs.3,554.49 lakhs will reduce the deficit to Rs.3,557.59 lakhs which will be further reduced to Rs.1,601.31 lakhs. Further details are indicated at Annexure II

Additional resource mobilisation and measures to cover deficit

        As I mentioned earlier, the recommendations of the Ninth Finance Commission in  respect of revenues from the Centre to the States during 1989-90 fall short of our expectations. To meet the situation arising therefrom, strict financial discipline is called for. Avoidable expenditure has accordingly been excluded as far as practicable from the next year's budget estimates. It has thus been possible to bring down the estimated deficit to about Rs.16 crores. However, at this level, the deficit is still high and steps have to be taken to reduce it further by additional resource mobilisation.

        Hon'ble Members are aware that the State Government had set up in June, 1988 the Meghalaya Commission on Resource Mobilisation under the chairmanship of Shri. P.R. Kyndiah. The Commission submitted Part I of its report last week. Its recommendations are now under examination. Pending detailed scrutiny of the recommendations, it is proposed to adopt the following measures for mobilisation of additional resources.

        A guarantee fee at the rate of 1 per cent is proposed to be levied in respect of loans availed by public sector undertakings for which the State Government acts as guarantor.

        The availability fee is proposed to be increased from Rs.5 to Rs.10 in respect of whisky, brandy, gin and rum and from Rs.3 to Rs.6 in the case of beer, cider, ale and other fermented liquor. License fees for different categories of outlets are also proposed to be revised. Having regard to the increasing offtake of rum from canteens the concessional rate of excise duty is proposed to be increased from Rs.9 to Rs.12 per LPL. As a measure of rationalisation and with a view to ensure prompt collection, it is proposed to merge the sales tax on India Made Foreign Liquor, beer and country liquor with excise duty. The sales tax and country liquor with excise duty. The sales tax on the hire of video cassette recorders and players is proposed to be increased from 2 to 10 percent.

        On food and drinks served in hotels and restaurants, the sales tax is proposed to be increased from 7 to 10 percent. The rate of tax on ready made garments will be increased from 6 to 9 per cent.

        The rate of Finance Sales Tax on cigarette cases and lighters, crockery made of bone china, ladies handbags and fire works will be raised from 7 to 12 per cent. Cosmetics including lipsticks, powder and snow will bear a rate of 15 per cent as against 10 per cent at present. On shaving sets, razors and shaving cream etc., the rate is proposed to be revised from 7 to 10 percent.

        The rate of purchase tax on timber excluding firewood is proposed to be raised from 25 percent to 40 percent.

Reliefs

        At the same time, in keeping with the importance attached by the Government to the welfare of the student community, it is proposed to afford certain reliefs for the benefit of students. The sales tax on school uniform is being withdrawn. Items such as exercise books, pencils and erasers are already exempted from tax. Tiffin boxes and school bags are also proposed to be exempted. The tax on butter not sold in sealed containers is being withdrawn as it is an item of mass consumption. The rate of tax on biscuits is also being reduced from 7 to 5 per cent.

        For the benefit of Government employees, a Fund to be known as the Employees' Welfare Fund is proposed to be introduced. Subscriptions will be made by Government employees at a nominal rate. Apart from the interest which will be paid to the employees on their deposits to the Fund, facilities will be available for withdrawal for a variety of purposes. Details in this regard will be finalised in consultation with the employees and their associations.

        After taking not of the loss of revenue resulting from the reliefs announced here, the proposed levies are estimated to yield an additional Rs.150 lakhs per annum. Bills to give effect to the proposed levies and reliefs are being introduced shortly.

        The estimated deficit is expected to be reduced thus to Rs.14.51 crores. Efforts will be made to narrow the deficit further by adopting wide-ranging economy measures, on the one hand, and by maximising the collection of Government dues, on the other. Existing tax measures will be streamlined and more effective enforcement will be aimed at. In particular, the levy on words contracts will be rationalised and made a more potent instrument of Government revenue. For any deficit that remains thereafter, special assistance will be sought from the Government of India. It is hoped that the Central Government will respond favourably and positively to our appeal for assistance.

        With these words, Sir, I beg to present the Budget Estimates for 1989-90 before the august House for their consideration and approval. As it will take some time for the House to discuss and approve the Budget proposals, a Vote-on-Account may be granted to enable the Government to carry on with its duties and responsibilities from the first day of the next financial year.

JAI  HIND.

ANNEXURE-I

Statement showing the sectoral allocation under 'State Plan' for 1988-89 and 1989-90

(Rs. in lakhs)
Sector 1988-89  1989-90
1 2 3

A. ECONOMIC SERVICES :

I.    Agriculture and Allied Services   

Crop Husbandry

455.00

615.00

Soil and Water Conservation

350.00

375.00

Animal Husbandry

195.00

226.50

Dairy Development

25.00

30.00

Fisheries

45.00

65.00

Forestry and Wildlife Preservation

832.50

835.00

Food Storage and Warehousing

7.00

7.50

Agriculture Research and Education

25.00

22.00

Investment in Agriculture Financial Institutions

0.50

Other Agricultural Programme -

(a) Marketing and Quality Control

40.00

40.00

(b) Others -

      Cooperation

140.00

150.00

Total - I - Agriculture and Allied Services

2,115.00

2,366.00

II. Rural Development

     Special Programme for Rural Development-

(a) Integrated Rural Development Programme (IRDP)

109.00

125.00

(b) Integrated Rural Energy Programme (IREP)

19.00

25.00

(c) Pilot Project for Village Development

10.00

10.00

Rural Employment -

      National Rural Employment Programme (NREP)

41.24

55.00

      Land Reforms

30.00

40.00

      Community Development and Panchayats

72.00

75.00

      State Centre for Research and Training in Rural   Development

5.00

5.00

Total - II - Rural Development

286.24

335.00

III. Special Area Programme

      Border Area Development Programme

210.00

200.00

Total-III-Border Area Development

210.00

200.00

IV. Irrigation and Flood Control

      Major and Medium Irrigation

30.00

50.00

      Minor Irrigation

230.00

230.00

      Command Area Development

20.00

20.00

      Flood Control Projects

30.00

55.00

Total-IV-Irrigation and Flood Control

310.00

355.00

V. Energy -

      Power

3,100.00

3,551.00

      Non-Conventional Sources of Energy (NRSE)

20.00

25.00

Total -V-Energy

3,120.00

3,576.00

VI. Industry and Minerals

      Village and Small Industries

90.00

115.00

      Sericulture and Weaving

75.00

95.00

      Industries (other than Village and Small Industries)

450.00

475.00

      Mining

55.00

70.00

Total-VI- Industries and Minerals

670.00

755.00

VII. Transport

      Roads and Bridges

1,850.00

2,200.00

      Road Transport

235.00

207.00

      Other Transport Services

20.00

Total-VII-Transport

2,085.00

2,427.00

VIII. Science, Technology and Environment-

      Scientific Research including Science and Technology

15.00

25.00

      Ecology and Environment

5.00

7.00

Total-VIII-Science, Technology and Environment

20.00

32.00

IX. General Economic Services-

      Secretariat Economic Services

15.00

15.00

      Tourism

70.00

90.00

      Survey and Statistics

11.00

15.00

      Civil Supplies

19.00

23.00

      Weights and Measures

10.00

10.00

Total-IX- General Economic Services

125.00

153.00

TOTAL-A-ECONOMIC SERVICES

8,941.24

10,199.00

B.  SOCIAL SERVICES :

X. Education, Sports, Arts and Culture-

      General Education

1,033.50

1,122.00

      Technical Education

30.00

39.00

      Arts and Culture

80.00

87.00

      Sports and Youth Services

60.00

185.00

Total-X- Education, Sports, Arts and Culture

1,203.50

1,433.00

XI.  Health -

      Medical and Public Health

358.82

400.00

Total-XI- Health

358.82

400.00

XII. Water Supply, Housing and Urban Development

      Water Supply and Sanitation

950.00

1,000.00

      Housing General

225.00

250.00

      Police Housing

300.00

307.00

      House Building Advance

55.00

100.00

      Urban Development

132.00

192.00

Total-XII- Water Supply, Housing and Urban Development

1,662.00

1,849.00

XIII. Information and Publicity -

      Information and Publicity

21.00

30.00

Total-XII-Information and Publicity

21.00

30.00

XIV. Welfare of Scheduled Castes, Scheduled Tribes and Other Backward Classes

Welfare of Scheduled Castes Scheduled Tribes and Other Backward Classes

1.50

2.00

Total-XIV-Welfare of Scheduled Castes, Scheduled Tribes and Other Backward Classes

1.50

2.00

XV.  Labour and Labour Welfare -

(a) Labour Welfare

3.50

4.00

(b) Craftsmen Training

13.10

13.50

(c) Employment Services

6.00

12.50

Total-XV- Labour and Labour Welfare

22.60

30.00

XVI. Social Welfare and Nutrition

      Social Security and Welfare

45.00

60.00

Nutrition -

(a) Special Nutrition Programme by Social Welfare Department

80.30

104.50

(b) Special Nutrition Programme by Community Development Department

6.50

6.50

(c) Middy Meal Programme by Education Department

5.20

5.00

Total-XVI- Social Welfare and Nutrition

137.00

176.00

XVII. Other Social Services -

      Aid to Municipalities

22.00

25.00

Total-XVII- Other Social Services

22.00

25.00

TOTAL-B- SOCIAL SERVICES

3,428.42

3,945.00

C.  GENERAL  SERVICES

XVIII. General Services -

       Stationery and Printing

55.00

65.00

       Public works

300.00

300.00

       Aid to District Councils

65.00

70.00

      Patrolling of National Highways

      Upgradation of standard of Administration

210.34

421.00

Total-XVIII- General Services

630.34

856.00

TOTAL-C-GENERAL SERVICES

630.34

856.00

GRAND TOTAL

13,000.00

15,000.00

ANNEXURE-II

The Financial position for the year 1989-90 with those of the previous years

(Rs. in lakhs)

Heads / actuals 1986-87 / Actuals 1987-88 / Budget 1988-89 / Revised 1988-89 / Budget 1989-90

Opening balance

(-)720.08

(-)1,678.06

301.07

(-)2,199.46

1,956.28

Revenue Receipt

21,465.90

25,645.18

29,884.10

30,459.83

31,256.06

Capital receipt under the Consolidated Fund

2,238.97

1,877.64

5,523.94

6,004.10

5,614.95

Capital Receipt under the Contingency Fund

946.02

906.40

600.00

981.62

600.00

Capital Receipt under the Public Account

112,325.21

119,861.80

116,436.46

128,203.47

130,270.83

Total Receipt

136,976.10

148,291.02

152,444.50

165,649.02

167,750.84

GRAND TOTAL

136,256.02

146,612.96

152,745.57

163,449.56

169,707.12

Revenue Expenditure

15,642.12

18,960.99

23,033.91

24,850.71

27,710.57

Capital Expenditure under the Consolidated Fund

7,379.38

7,474.66

13,260.53

13,624.98

12,782.03

Capital Expenditure under the Contingent Fund

945.96

906.40

600.00

981.62

1,200.00

Capital Expenditure under the Public Account

113,966.62

121,470.37

116,664.46

122,035.97

129,615.83

Total Expenditure

137,934.08

148,812.42

153,558.90

161,493.28

171,308.43

Closing Balance

(-)1,678.06

(-)2,199.46

(-)813.33

1,956.28

(-)1,601.31

GRAND TOTAL

136,256.02

146,612.96

152,745.57

163,449.56

169,707.12

NET RESULT

(a) In Revenue Account

(+)5,823.78

(+)6,684.19

(+)6,850.19

(+)5,609.12

(+)3,554.49

(b) Outside Revenue Account

(-)6,781.76

(-)7,205.59

(-)7,964.59

(-)1,453.38

(-)7,112.08

(c) All Accounts excluding the opening and closing Balance

(-)957.98

(-)521.40

(-)1,114.40

(+)4,155.74

(-)3,557.59

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

DPS (Press Wing) Fin. 12/89-600+50-26-3-89