Government of Meghalaya

Budget Speech

2001 - 2002


Shri A. H. Scott Lyngdoh

Finance Minister, Meghalaya

27th March, 2001

Mr. Speaker, Sir,

I rise to present the Budget Estimates for the year 2001-2002. This is the fourth Budget of this august House and our first for the twenty first Century. It reflects proposals for the fifth and final year of Ninth Five Year Plan.



Like last year, the Planning Commission is yet to finalise the size of the Annual Plan for the year 2001-02. In fact, the size of the current year's annual plan at a core level of Rs.48,000 lakhs was finalised by the Commission during November 2000 only. The Draft Annual Plan for the year 2001-02 as submitted to the Planning Commission, formulated on the basis of our provisionally estimated resources, provides for a core Annual Plan of Rs.55,2000 lakhs, which is 15 percent higher than the level of the current year's approved core plan. This has been incorporated in our Budget Estimates subject to adjustment, mulatis-mutandis, as and when the Planning Commission finalises the size of our Annual Plan for next year.


The recommendations of the Eleventh Finance Commission (EFC), announced during the current year were favorable to us in certain aspects, but unfavorable in others.


While our Revenue Gap Grant increased from Rs.31,642 lakhs under the Tenth Finance Commission (TFC) Award to  .Rs.1,57,238 lakhs under the EFC Award, our Share of Central Taxes decreased from Rs.1,30,636 lakhs under the TFC Award to Rs.1,28,702 lakhs under the EFC Award.


During the current year, our Revenue Gap Grant is Rs.33,813 lakhs as against no grant during 1999-2000. However, our Share of Central Taxes during the current is Rs.18,4888 lakhs as compared to Rs.34,176 lakhs during 1999-2000. However an amount of Rs.4,340 lakhs released to our State in excess of our Share of Central Taxes during the period 1996-97 to 1999-2000 has been partly adjusted against our current year's share, further eroding our resource base.


Further, unlike the Award to earlier Finance Commissions, the EFC Award has linked 15 per cent of the amount awarded to States to cover their revenue gap, to adoption and implementation of fiscal reforms, such as widening the tax base, increasing tax rates on a year to year basis, pricing services such as irrigation, water charges, bus charges, reducing subsides, abolition of vacant posts in Government except those of Primary Teachers and Health Workers, resorting to contract appointments, works, moratorium on all new work-charge and casual appointments, phased reduction of non-plan expenditure, downsizing of Government, moratorium on creation on posts, etc. Thus only 85 percent of our Revenue Gap Grant for the current year amounting to Rs.28,741 lakhs is available. The remaining 15 percent amounting to Rs.5,072 lakhs has been reserved and transferred to an Incentive Fund, for subsequent release depending on our progress in implementing fiscal reforms.


In this connection, I wish to inform this august House that the Central Government has specified that releases from the Incentive Fund will be based on a single monitorable fiscal objective, namely, each State will be expected to achieve a minimum improvement of 5 percent in their revenue deficit or surplus as proportion of their revenue receipts each year, till 2004-05, with 1999-2000 as the base year.


The actual budgetary surplus of our State for the year 1999-2000 as certified by the Accountant General Meghalaya is Rs.157.46 lakhs as against Actual Revenue receipts of Rs.94,364,98 lakhs, resulting in a surplus of 0.16 per cent.


Our continuing economy measures is expected to result in a further improvement over the position reflected in the Revised Estimates for the current year and to yield a budgetary surplus of about Rs.2,889,83 lakhs as against revised Revenue receipts of about Rs.123,722.19 lakhs, resulting in a budgetary surplus of 2.33 per cent. 


Thus, our budgetary surplus of our State for the year 1999-2000 as certified by the Accountant General Meghalaya is Rs.157.46 lakhs as against Actual Revenue receipts of Rs.94,364.98 lakhs, resulting in a surplus of 0.16 percent.


Our continuing economy measures is expected to result in a further improvement over the position reflected in the Revised Estimates for the current year and to yield a budgetary surplus of about Rs.2,999 lakhs as against revised Revenue receipts of about Rs.123,722.19 lakhs, resulting in a budgetary surplus of 2.33 percent. 


Thus, our budgetary surplus as a  percentage of revenue receipts is likely to increase from 0.16 percent during 1999-2000 to 2.33 percent during 2000-01 reflecting an improvement much in excess of the required 5 percent. We therefore qualify for release of our current year's share of the Incentive Fund. However, releases from the Incentive Fund will only be available to States commencing from next year, with consequent improvement of our fiscal position during 2001-02.


Before, I present the Budget Estimates for 2001-02, I propose Mr. Speaker, Sir to briefly reflect on the National Economy, the State Economy and highlight some of the proposed programmes for the year, besides indicating our present performances.



The Union Budget presented to Parliament by the Union Finance Minister on 28th February, 2001 indicates an expected growth rate of 6 percent for the national economy during the current year.



During the period 1992-93 to 2000-2001, the national economy grew at an average rate of 6.4 % per year as compared to 5.8 % during the corresponding period in the 1980s.


Incidence of Poverty fell from 36 % during 19993-94 to 24 % or less during the current year.


The export-performance grew by over 20 % during April-December, 2000 and compares favorably with the growth rate of better performance economies.


Inflation increased to around 4 % during the current year due to increase world petroleum prices. This has put a strain on the national economy as a whole.


A new National Policy on Agriculture has been announced. The multi-pronged strategy provides interalia for enhanced credit flow to boost agricultural production and creation of adequate storage infrastructure for perishable commodities through credit-linked subsidy schemes.


An amount of Rs.3,800.00 lakhs has been provided in the Union Budget 2001-02 for the "Technology Mission for Integrated Development of Horticulture in the North Eastern States."


Corporatisation of Telecom Services has been implemented and competition is being introduced in all service segments. Overall teledensity is expected to reach 3.5 per hundred which works out to double the teledensity achieved two years ago.


The year 2001-02 is expected to end with a fiscal deficit of 5.1% as a percentage of the GDP.



The Net State Domestic Product at current prices which stood at Rs.6,441 lakhs during 1972-73 rose to Rs.2,46,713 lakhs during 1999-2000 and is likely to reach 2,80,620 lakhs during the current year.



The Net State Domestic Product in terms of per capita income at current prices registered an increase from Rs.538 during 1970-71 to Rs.11,678 during 1999-2000 as compared to an all India increase from Rs.633 to Rs.16,047 during the same period.



The Advance Estimates of NSDP for the current year is Rs.13,029 per capita as compared to an all India estimate of Rs.17,643. The estimated annual growth during the current year is about 11.57 percent. However, the average per capita income is about 35.4 percent lower than the average all India level.



The Gross State Domestic Product at constant prices for the year 1998-99 as per Quick Estimates is about Rs.2,02,249 lakhs, indicating a growth rate of 5.76 percent during 1999-2000. An improved annual growth of 5.95 percent is expected during the current year.



The Tertiary Sector of our economy continues to dominate other sectors. During 1999-2000 the share of this sector at constant prices stood at 56.54 percent. It is expected to marginally increase to 56.60 percent during the current year.



The contribution of the Secondary Sector is likely to increase from 11.45 percent during 1999-2000 to 11.62 percent during the current year.



However, the contribution of the Primary Sector is likely to decline from 32.01 percent during 1999-2000 to 31.77 percent during the current year.




The Annual accounts of the State for the year 1999-2000 have been verified by the State Accountant General as usual. The audit Report on the Annual Accounts 1999-2000 reflects the following position -


The year opened with a budgetary deficit of Rs.3,614 lakhs.


Against a total revenue receipt of Rs.94.365 lakhs, the total revenue expenditure was Rs.92,779 lakhs resulting in a revenue surplus of Rs.1,586 lakhs.


Against the total revenue receipts, recoveries and other receipts amounting to Rs.95,254 lakhs, the total revenue and capital expenditure was Rs.1,19,540 lakhs resulting in a fiscal deficit of Rs.24,286 lakhs.


Against the fiscal deficit of Rs.24,286 lakhs, there was an interest payment of Rs.9,809 lakhs resulting in a primary deficit of Rs.14,477 lakhs.


Against a total budgetary receipt of Rs.14,16,480 lakhs, there was a total budgetary expenditure of Rs.14,12,709 lakhs resulting in a budgetary surplus of Rs.157 lakhs after adjusting the budgetary deficit of Rs.3,614 lakhs.



The emerging position reflects a marked improved over the fiscal position reflected in the budget estimates for the same year as presented to the State Legislature. This has been possible due to steps taken to generate additional fiscal resources and the continuing economy measures.



Steps for generating additional resources and exercising utmost economy through stringent economy measures including the system of letter of Credit and Letter of Allotment have been continued during the current year. Such measures have resulted in the budget estimates for 2000-01 being revised as follows -


The revised estimates for the year 2000-01 reflect an opening balance of Rs.157 lakhs.


Against a revised revenue receipt of Rs.1,23,722 lakhs the revised revenue expenditure is Rs.1,19,286 lakhs resulting in a revenue surplus of Rs.4,593 lakhs.


Against a revised total budgetary receipt of Rs.14,97,043 lakhs, the revised budgetary expenditure is Rs.14,94,310 lakhs resulting in a budgetary surplus of Rs.2,890 lakhs including the opening balance of Rs.157 lakhs.



It is proposed to continue with the economy measures currently in force besides resorting to additional resource mobilisation in terms of fresh taxation proposals which I will make later today. These are expected to result in further improvement of the State's fiscal health. The budget estimates being presented today for the year 2002-2002 propose as follows -



An opening balance of Rs.2,890 lakhs.


A total revenue receipt of Rs.1,32,113 lakhs against a total revenue expenditure of Rs.1,35,483 lakhs resulting in a revenue deficit of Rs.3,370 lakhs. However the estimated revenue deficit of Rs.3,370 lakhs will be entirely made up by the anticipated release of Rs.5,072 lakhs from the Central Incentive Fund as already indicated. Further additional resources generated and attendant economy measures will result in further savings and the year is expected to close with adequate revenue surprises.



The total budgetary receipts during the year are estimated at Rs.15,40,285 lakhs against a total budgetary expenditure of Rs.15,38,593 lakhs resulting in a budgetary surplus of Rs.4,582 lakhs, which is likely to further improve as a consequence of the measures already indicated.



As indicated in my budget speech for the year 2000-01, the Letter of Allotment system has now been introduced in all Departments of the State except in relation to payments of salaries and allowances. The system has proved useful and resulted in appropriate regulation and control of spending from the public exchequer. These measures will continue.




Along with the budget estimates for the current year, I shall also be presenting a Vote-on-Account for covering expenditure during the first three months of the year 2001-02, for consideration of this august House. The full budget will be taken up for consideration during the re-assembled Budget Session which is likely to be held during June 2001.



It is expected that while considering the budget estimates, the Hon'ble Members would have the benefit of the suggestions of the House Committee.




The Non-Plan Budget Estimates for 2001-2002 envisage an outlay of Rs.1,09,642.47 lakhs which is 13.6 percent higher that a likely non-plan expenditure of Rs.96,458,03 lakhs during the current year. Every attempt has been made to adequately provide for normal maintenance and recurring expenses, amortisation of debts and liabilities and critical maintenance cost of normalised projects. While fiscal measures to contain avoidable non-plan expenditure will continue, adequate care has been taken to ensure that critical and unavoidable segments of expenditure are protected and sufficiently provided for.


VII. PLAN BUDGET 2001-2002


The approved Ninth-Plan outlay is Rs.2,50,062 lakhs. The plan expenditure during 1997-98, 1998-99 and 1999-2000 were Rs.24,883 lakhs, Rs.29,909 lakhs and Rs.34,328 lakhs, respectively. Although the approved core Plan size for the current year is Rs.48,000 lakhs, the revised Plan size based on available resources is likely to be Rs.46,700 lakhs only, which is 33.4 per cent higher than the revised plan size of Rs.35,000 lakhs during the year 1999-2000. Thus the cumulative plan expenditure during the first four years of the Ninth Plan is likely to stand at Rs.1,35,820 lakhs which is 54.3% of the approved size of the Ninth Plan.



The proposed Annual Plan size of Rs.55,2000 lakhs for the year 2001-2002 is 18.2% higher than the likely plan expenditure of Rs.46.700 lakhs during the current year.



Peace and harmony are essential pre-requisites for growth and development. The State has remained free from communal disturbance during the year. However, local militant outfits have resorted to a number of killings and kidnapping giving cause for concern and evoking angry public response. With the declaration of the HNLC and ANVC as unlawful Associations by the Government of India, these militant organizations have intensified their criminal activities in different parts of the State. Government is committed to wean away members of such Outfits through appropriate rehabilitation schemes. Appeals have also been made to such misguided groups to come over ground for negotiations and join the main stream of public life. Church Leaders and responsible citizens have been playing positive and commendable roles in this regard. 29 militants belonging to the ANVC have come forward and surrendered. Government accords the highest priority to the rehabilitation of such surrendered militants and every effort is being made for this early rehabilitation.



Agriculture plays a predominant role in the State's economy. Land utilization statistics indicate that the gross cropped area of 2.49 lakh hectares during 1996-1997 is likely to increase to 3.00 lakh hectares during the current year reflecting an increase of 21.4 percent during the period. The gross cropped area is expected to increase to 3.20 lakh hectares during 2001-2002.



The current year is expected to end with a total foodgrain production of 2.28 lakh tonnes, recording an increase of 28 percent over the total production of 1.78 lakh tonnes during 1996-1997. Rice which is the major crop accounts for 1.51 lakh tonnes or 66 percent of the total foodgrain production. The target food grain production for the next year has been fixed at 2.41 lakh tonnes.  



Of the commercial crops, potato account for 56.7 percent of the total production. The production of potato is likely to increase from 2.00 lakh tonnes during 1996-1997 to 2.39 lakh tonnes during the current year, registering an increase of 19 percent during the period.



Horticultural produce which stood at 2.10 lakh tonnes during 1996-1997 is expected to increase to 3.70 lakh tonnes during the current year indicating an increase of 76 percent over the period. This production is expected to further increase by 39.7 percent to 5.17 lakh tonnes during 2001-2002.



However, production from High Yielding Varieties of paddy, wheat and maize has fallen from 104.75 lakh tonnes during 1996-1997 to 98.10 lakh tonnes during the current year. The matter is receiving attention and corrective measures are being initiated. 



The commissioning of the two principal Regulated Markets established by the State Agricultural Marketing Boa at Mawiong and Garobadha is expected to ensure a fair deal to the farmers in terms of general and cold storage facilities and auction platforms. Efforts are being made to preempt the practice of day end distress sales of agricultural produce.



The plan investment in the Agriculture Sector increased from Rs.1060.25 lakhs during 1996-1997 to a revised level of Rs.1325 lakhs during the current year. An amount of Rs.1919 lakhs is proposed for this sector during 2001-2002 reflecting an increase of 44.8 percent.




The cumulative results of Soil & Water management efforts over the last twenty-eight years of our Statehood are reflected in the increase of developed agricultural lands with assured irrigation from 1500 hectares during 1972-1973 to 44,561 hectares during the current year and a corresponding increase in afforested degraded lands from 1053 hectares to 30,253 hectares, over the same period. Similarly, the area under erosion-control and cash crop plantations rose from 102 hectares and 363 hectares to 9366 hectares and 10,299 hectares, respectively. The programme for weaning away Jhummia-families, presently numbering around 49,500, is being accelerated. The sectoral target for 2002-2003 includes-


Land Development, afforestation and water distribution covering and area of 2563 hectares, besides maintenance of 2718 hectares of existing plantations.


Erosion Control Works over 849 hectares; and


Water harvesting and farm-ponding over an area of 320 hectares.
  The plan investment on this sector increased by 52.8 percent from Rs.556 lakhs during 1996-1997 to the revised level of 850 lakhs during the current year. An outlay of Rs.947 lakhs is proposed for this sector during 2001-2002.



The increase in the Plan investment from Rs.546.14 lakhs during 1996-1997 to the revised allotment level of Rs.810 lakhs during the current year is indicative of the importance attached to this sector Production estimates indicate that over 27 percent of the annual egg and meat requirement is met through supply from other States. Every effort is being made to achieve self sufficiency in this field.



Egg production is expected to increase from 79 million during 1996-1997 to 87 million during the current year, and meat production from 27,700 tonnes to 33,000 tonnes over the same period. Egg and meat-production for 2001-2002 is targeted at 90 million and 34,000 tonnes respectively.



Milk production has similarly registered an increase from 0.57 lakh tonnes to 0.64 lakh tonnes during the last five years.



Plan investment on this sector increased from Rs.546 lakhs during 1996-1997 to Rs.810 lakhs during 200-2001. The Plan outlay for 2001-2002 has been tentatively fixed at Rs.1,332 lakhs.




Fish production in the State account for about 20 percent of our annual requirement. Every effort is being made to increase fish culture in the private sector, besides making better utilisation of available natural water bodies, in order to bridge the demand-supply gap with in the shortest possible time frame.



Inland fish production registered an increase from 4400 tonnes during 1996-1997 to an expected level of 5000 tonnes during the current year.



In order to encourage fish production, the sectoral outlay for this sector has been increased by 59 percent over the current year's revised level and proposed at Rs.175 lakhs during 2001-2002.




The Cooperative Movement in the State has progressed over the year. During the period April, 1999 to December, 2000, 44 new Cooperative Societies were registered. The total turnover of Consumer Cooperatives during 1999-2000 was around Rs.355 lakhs. The sectoral plan outlay increased from Rs.219 lakhs during 1996-97 to a revised level of Rs.300 lakhs during the current year.



The Meghalaya Cooperative Apex Bank now has 37 branches, both in rural and urban areas. As a major agricultural credit institution, the Bank has achieved a fairly good Credit : Deposit Ratio of 33.71 percent as compared to the average level of 19.97 percent for all Banks in the State. 



Activities to be undertaken under this sector during 2001-2002 include revitalisation of cooperatives through effective cooperative education and training, strengthening of marketing cooperatives and supply of quality goods to consumers.


  As against a revised sectoral outlay of Rs.300 lakhs during the current year, an outlay of Rs.444 lakhs has been proposed for the year 2001-2002.




In accordance with the directives of the Supreme Court, Working Plans for the operation of State Forests have been approved by the Central Government. However, the operation of these Plans is subject to the recent directions of the Apex Court. Requirements contained in the aforesaid directions are being met and the Working Plans are expected to be operationalised shortly.



The Autonomous District Councils are being assisted in the preparation of Working Plans for forests under their control. Likewise, steps have been taken to support the preparation of Working Plans of private plantations.



As a long term measure to conserve flora and fauna, an Armed Forest Protection Force is being set up in the State. An amount of Rs.1000 lakhs has been provided under the Eleventh Finance Commission Award.



Government proposes to set up a Bio-Diversity Research Centre in the State. A suitable plot of land has been identified in Ri-Bhoi District and acquisition of the site of establishment of the Centre will shortly be completed. The programme will be funded by the Central Government.



With a view to provide alternative means of sustenance to the upland poor, particularly forest plantation workers who had been adversely affected by the implementation of Apex Court Orders regulating felling of trees, efforts have been made to implement a project for the development of Forestry and Non-Timber Forest Produce (NTFP) with particular emphasis on raising and utilisation of bamboo. Project proposals were discussed by a State delegation headed by the Chief Minister with the International Fund for Agricultural Development (IFAD) at Rome from 21st-27th February, 2001, on the basis of a project pre-feasibility report drawn up by a Three-Member IFAD Mission which had visited the State during October-November, 2000. The discussions with IFAD were attended by representatives of-


  The International Network for Bamboo & Rattan (INBAR), Beijing.
  The Food & Agricultural Organization (FAO) of the UN
  The World Trade Organization (WTO)
  The United Nations Conference for Trade & Development (UNCTAD)
  The International Trade Centre (ITC)
  The International Development Resource Centre (IDRC)
  The International Bamboo Expert Professor Walter Leise
  The discussion with IFAD resulted in IFAD agreeing to -


Develop a pro-poor, pro-women and pro-youth project for Meghalaya;


Provide indicatively about USD 15 million equivalent from its own resources;


Make an effort to mobilise an additional USD 15 to 20 million from other agencies provided that significant progress in peace and reduction in conflict is achieved.
  The proposed project funding from IFAD will be routed through the Government of India and is expected to  flow to the State as 90% Grant and 10% loan, as per usual process.
  The Institutional frame work for implementation of the proposed project will depend upon the recommendation of the Project Formulation Mission. Normally, IFAD implements its' projects through it's own field organisation/offices.
  In pursuance of the aforesaid decisions, IFAD has informed State Government on 09.03.2001 that-
  ITC has agreed to undertaken a joint IFAD-ITC project development effort for the proposed IFAD project in Meghalaya.
  ITC has agreed to provide technical assistance during the implementation of the proposed project.
  The Tenural Right Study Mission will commence in Meghalaya shortly.
  A Joint IFAD-INBAR-UNIDO Market Study Mission will commence its work soon and submit its Report within September, 2001;
  The project Inception Mission will be fielded during November, 2001;
  The Project Formulation Mission will be fielded during January-February, 2002 or April-May, 2002.



The major achievements during the current year under this sector include-


Creation of durable community assets through utilisation of an amount of Rs.266 lakhs under the centrally sponsored Jawahar Gram Samridhi Yojana (JGSY) Scheme.



Formation of 336 self-help Groups under the Centrally Sponsored Swarnjayanthi Gram Swarojgar Yojana (SGSY) Scheme.


40 villages are being connected during the year under the recently launched Pradhan Mantri Gram Sadak Yojana (PMGSY).


10000 families being provided Prime Minister's Gramodaya Yojana support under the housing component of the PMGY during the year.
  Efforts to bridge critical gaps in the rural infrastructure in selected sectors will continue under the Employment Assurance Scheme. During the year, an amount of Rs.248 lakhs has been utilised under the scheme.
  1430 new shelters have been completed and 734 shelters upgraded during the current year, under IAY.
  14,323 old and destitute citizens, 2883 mothers and 326 other beneficiaries are expected to benefit during the current year under the National Social Assistance Programme.



Till December, 2000, 734000 mandays of rural development has been generated under the different Centrally Sponsored Employment Generation Programmes. It is expected that a total 985000 mandays of employment will be generated by the end of the year.


  The programmes will continue with added vigour during 2001-2002.



The success of a delivery system is often measured by the efficacy of development administration at the grass root level. The Community and Rural Development Blocks which are our grass root level institutions have been performing satisfactorily. 



It has been decided to create 7 new Community and Rural Development Blocks under the Eleventh Finance Commission Award, during the current year. This will accelerate the pace of rural development and ensure that the benefit of development reaches the rural masses more effectively.



An amount of Rs.780lakhs has been allocated for this sector during 2001-2002.



During the current year, allocation under this programme has been increased from Rs.20.00 Lakhs to Rs.25.00 Lakhs per rural Assembly Constituency and from Rs.10.00 Lakhs to Rs.12.50 Lakhs per semi-rural Assembly Constituency.


This programme has generated sustainable community assets and will continue as a major programme under the Rural Development Sector.



Guidelines for formulation, approval and implementation of the programme have been finalised. The programme will continue during 2001-2002.



Border areas in the State account for a total of 1523 villages located within 10 kilometres of the international boundary with Bangladesh and cover an area of approximately 4230 Sq. Kms. Border Area Development Schemes are implementing through different departments in order to improve the economic condition of the people inhabiting these areas.


  During the current year, 15,353 students hailing from the Border areas have been covered the Border Areas Scholarship Scheme. It is  proposed to cover another 25,00 students under the scheme during 2001-2002



The main focus of Border Are Programme during the current year has been on rural electrification, construction of School buildings, market stalls, ropeways, community halls, footpaths and footbridges. During 2001-2002, priority will be given to construction of link roads, water supply schemes and electrification of border villages under Special Central Assistance



An amount of Rs.812 lakhs is proposed to be provided for the programme during 2001-2002.




The Rongai Valley Irrigation Project sanctioned at a cost of Rs.1630 lakhs is the only Medium Irrigation Project in the State. Over 66 percent of the barrage works have been completed. The project is expected to be completed by the end of the year2003.



The estimates for survey and investigation of Kodaldhowa, Pynthornein and Mawrambah Valley Medium Irrigation Projects have been sanctioned. Investigation works on these projects are in progress during the current year.


  The plan allocation under this sector is proposed to be increased from the revised level of Rs.550lakhs during the current year to Rs.795 lakhs during 2001-2002.




An additional area of 6927 hectares is expected to be brought under Minor Irrigation by the end of the Ninth Five Year Plan Period bringing the total area under irrigation to 28,147 hectares. However this represents only 12.9 percent of the total irrigation of the State.



Government have decided to create a separate Directorate of Irrigation which is expected to become functional from 2001-2002. With this development, it is expected that the Irrigation  potential of the State will be exploited to the fullest extend. 



The  provision for Minor Irrigation Sector has been increased from the revised level of Rs.710 lakhs during the current year to Rs.1100 lakhs during 2001-2002 reflecting an increased of 54.9 percent. A provision of Rs.200 lakhs has also been made for the Command Area Development programme during 2001-2002..


8.15. POWER


During the current year, the Central Government has released an amount of Rs.600 lakhs for improvement of Power Supply in Tura, Rs.400lakhs for improvement of Power Supply in Shillong and Rs.75 lakhs for electrification of 10 tribal villages, from the Non-Lapsable Pool of Central Resources.



Environmental clearance for the 2 42 MW Myntdu-Leishka Project is yet to be issued by the Central Government. Implementation of the project which has been techno-economically cleared by the Central Electricity Authority at a revised cost of Rs.36,305lakhs is expected to commence during 2001-2002. 



The renovation and modernisation of Umiam Stage-1 Power Station is in an advanced stage of progress. The approved outlay during the current year is Rs.570 lakhs. The proposed outlay for this purpose during 2001-2002 is Rs.620 lakhs.



With the increasing energy-demand in the industrial areas of Byrnihat, the Meghalaya State Electricity Board has formulated a proposal for setting up of two Heavy Fuel based Power Stations of 4 6 MW each, costing an estimated amount of Rs.9000 lakhs for each station.



During the current year, the State Government has initiated the 'Clean Umiam' project with a view to contain siltation and further pollution of the Umiam Lake.




The Meghalaya Non-Conventional and Rural Energy Development Agency (MNCREDA) is implementing Solar Thermal and Solar Photovoltaic schemes which include the installation and distribution of Solar Cookers. Solar Centralised Power Packs and Solar Lanterns.



Three 100 KW Micro Hydel Projects at Galwang in West Garo Hills, Rongap in East Garo Hills and Umlieh in Ri-bhoi District are proposed to be taken up during 2001-2002.




Incentives available to industrial entrepreneurs under the State Industrial Policy, 1997, the Excise concessions extended by the Government of India and the establishment of the Export Promotion Industrial Park (EPIP) at Byrnihat have created a favourable atmosphere for the development of Industries in the State. The Single-Window Agency has cleared a total of 112 applications with a potential investment of Rs.43,200 lakhs and an employment potential of 7185.



The Promotional activities under this sector include the creation of infrastructure like the Export Promotion Industrial Park (EPIP) at Byrnihat, the Growth Centre at Mendipathar, the Industrial Area at Umiam and the Industrial Estates located at Jowai, Tura, Nongstoin, Williamnagar and Mendipathar.



State Government has, so far, approved the establishment of 21 industrial units at the EPIP, Byrnihat. Land Acquisition proceedings for acquisition of 173.23 hectares of land for the Mendipathar Growth Centre have been initiated



Training Schemes under this sector include Entrepreneur Development Programme, Man-Power Training and Training of Artisans and Entrepreneurs inside and outside the State. During the current year, 132 students were sponsored by MIDC for undertaking specialized courses in Engineering, Computer Science, Chartered Accountancy, Management and other professional courses. 122 artisans and entrepreneurs were trained locally while 16 were trained outside the State. 



The Khaddar & Village Industries Board continue to implement Rural Employment Generation Programmes, Block Development Schemes and Consortium lending. During the current year, 50 beneficiaries were sponsored by the KVIB under the margin Money Scheme.



The MCCL is facing a stiff competition in marketing its products in view of the emerging new brands of cement. With the implementation of the ongoing modernisation plan, the Company is expected to overcome its present competitive discomfiture.


  Production of cement during the current year is expected to reach 1,20,000 tonnes as compared to 1,14,700 tonnes during 1999-2000.


  The proposed plan outlay for this sector is Rs.1,300 lakhs during 2001-2002.




The focus of this sector is for increased production of Silk-Cocoons and Handloom Fabrics through mobilisation of existing resources and infrastructure.



Besides implementation of the NEC funded project for the Integrated Development of Muga, the Department continues to implement the Catalytic Development Programme of the Central Silk Board and the UNDP assisted sub-programme for development of Eri and Muga. Schemes under the Deen Dayal Hathkargha Protshahan Yojana will also be implemented during 2001-2002.



Additional plantation coverage of 483 Hectares under Mulberry, Eri and Muga is proposed to be taken up during 2001-2002. This is expected to result in a production of 4,38,000 Kilograms of Mulberry and Eri Silk Cocoons and 2,26,80,000 Muga Cocoons during 2001-2002.



The production of Mulberry and Eri Silk Cocoons in the State has increased from 2,61,000 Kilograms during 1996-1997 to an expected level of 3,75,000 Kilograms during the current year. Similarly, the production of Muga Silk Cocoons is expected to increase from 62,74,000 to 1,14,00,000 over the same period.



Likewise, the production of handloom fabric in the State has registered and increase from 33,58,000 square metres during 1996-97 to an expected level of 67,60,000 during the current year.




The Department of Mining & Geology will continue its effort to tap the mineral resources of the State, besides intensifying mineral investigation.



During the current year, six on going mineral investigations have been continued and one new investigation has been taken up. In addition, nine geological investigations are taken up annually.



Till December, 2000, the production of coal and limestone during the year is 26,19,000 tonnes and 2,47,000 tonnes respectively.



In order to mobilise additional revenue and to check evasion of revenue, the Department proposes to install electronic weigh-bridges at Gasuapara and Dawki during 2002-2002.



An amount of Rs.3,223 lakhs has been collected as revenue from mineral resources upto December, 2000.




Since road transport is the only means of communication, the development and strengthening of road infrastructure occupies a central place in the overall development strategy of the State. The road sector continues to receive the highest priority. During the current year, Rs.9,470 lakhs or 20 percent of the revised plan outlay has been allocated to this sector.



The total road length of the State till the end of 1999-2000 was 7117 Kilometres, resulting in a road density of 31.73 Kms per 100 Square Kilometre which is below the national norm of 40 Kilometres per 100 Square Kilometre. The ongoing efforts are likely to result in 7267 Kilometres of road-length by the end of the current year.



2633 villages have been connected by roads till the end of March, 2000. 60 more villages are expected to be connected with roads during the current year.




Government continues to pursue a liberal policy in issuing road permits for operation of transport services. The enforcement machinery is being streamlined to curb evasion of motor vehicle tax and plying of illegal and unauthorised vehicles.




The construction of Baljek Airport has been completed at a cost of Rs.1,221 lakhs. The Government of India has released an amount of Rs.318 lakhs during the year for this purpose, from the Non-Lapsable Central Pool of Resources. Steps are being taken to operationalise the airport at the earliest. The proposed up-gradation of the Umroi Airport is expected to materialise during 2001-2002.



The programme for establishment of ropeways, wayside, amenities, motor driving schools and assistance to transport operators belonging to the weaker sections, for procurement for vehicles, will continue.



Helicopter Service between Shillong, Guwahati and Tura will be continued during 2001-2002. Expansion of such services to other district headquarters will be undertaken when feasible.




The Meghalaya Transport Corporation operates on 39 routes covering a distance of 5,265 Kilometres. 10 new bus chassis have been acquired during the year to replace old and condemned ones. The Corporation has been running on continuing losses. Government is exploring ways and means to revitalize the Corporation including privitisation.




Introduction of Appropriate Technologies is the main programme under this sector. The programme emphasises on generation of awareness and training of people on appropriate technologies. The Technology initiation Programme which has launched recently will continue



The programme on popularisation of Silence & Technology involving Science Exhibition Workshop and Environmental Fairs will also continue.



Proposal for setting up of a Technology Park at Nongpoh and establishment of three Centrally-funded Technology Parks in East Khasi Hills, West Khasi Hills and Ri-Bhoi Districts are expected to be taken up during 2001-2002.


8. 25. TOURISM


Tourism is an eco-friendly industry with an enormous potential which can be suitably exploited and harnessed for the overall development of the State. Meghalaya has an edge over other tourist destinations in the North-East as it possesses a unique of different cultures and and congenial climatic conditions.



The State Tourism Policy was announced on the 15th February, 2001. The Policy envisages the creation of employment opportunities for the youth of the State, projection of a tourist friendly image in order to attract tourists from all over the country as well as from overseas, extension of socio-economic benefits to the community in terms of better income generation and foreign exchange earnings and encouraging local enterprise towards setting up a facilitative infrastructure like Hotels, Health Resorts, Amusement Parks and Tourism Units, through a package of incentives. This initiative is expected to result in the required thrust destination to enable the State to emerge as the best tourist destination in the North East in the years to come.



During 2001-2002 the Department proposes to take up development of view points in different places of South Garo Hills and East Garo Hills Districts and at Sung Valley in Jaintia Hills District, construction of cottages and suspension bridge-crossing to Nongkhnum Island, construction of Yatri Niwas at Jowai, Tourist Lodges at Mahadeo and Nongstoin and also commissioning of the Yatri Niwas at Tura, Tourist Lodges at Baghmara and Siju and Wayside Amenities at Anogiri.



The long-drawn litigation over the construction of the Crow borough Hotel was finally concluded in an out of court settlement. The State Government is taking steps for early completion of the building and for creation of income generating facilities in order to sustain the Meghalaya Tourism Development Corporation.




The Public Distribution System is serviced through a network of 649 Fair Price Shop in urban areas and 3,646 Fair Price Shop in rural areas. The Operation of the Fair Price Shops will be closely monitored and supervised to ensure that they serve the best public interest.



During the year, the State Commission and the District Forum have disposed of 262 out of the 340 cases registered with them.




State Government will continue to work closely with the Autonomous District Councils. The programme for providing grants-in-aid to the District Councils for construction of village roads, footpaths, bridges, playgrounds. Councils own office buildings and improvement of rural markets will continue. An amount of Rs.966 lakhs has been proposed in the Budget Estimates for such purposes.




Education continues to receive high priority. About 12 percent of the Plan outlay is earmarked for this sector. The State will continue in its efforts to improve educational standards including facilities and service conditions of teachers.



Over 38 percent of Primary Schools and 27 percent of Upper Primary Schools do not have permanent buildings. Construction of Primary School buildings will be undertaken during 2001-2002 under the Eleventh Finance Commission Award as well as under the PMGY Scheme.



During the current year, over 3,19,000 students are enrolled in Primary Schools and over 91,000 students in Upper Primary Schools reflecting a very high drop out rate of over 2 in 3 between the Primary and Upper Primary stages.



Over 61 percent of Primary School Teachers and 73 percent of Upper Primary Teachers in the State have not been trained. The District Institutes of Education and Training (DIET) at Thadlaskein, Sohra and Resubelpara have been made operational with a view to improve the quality of Elementary Education. While civil works for operationalising the DIETs at Nongstoin, Nongpoh and Baghmara are presentably underway, the Central Government has recently sanctioned one more DIET for Tura. The percentage of trained teachers and the quality of training are expected to further improve during 2001-02.



The Central Government has released Rs.1120 lakhs for Elementary Education from the Non-lapsable Central Pool of Resources during 2000-2001.



Pre-project activities for introduction of new courses in the Shillong Polytechnic and the setting up of new Polytechnics in Jowai and Tura have already been initiated under a World Bank Assisted Project.



Education Department has regulated the number of working days in Schools and Colleges to a minimum of 220 days in conformity with national norms.



During the current year, opening-permission has been granted tom 43 Secondary Schools, 13 Higher Secondary Schools and 6 Private Colleges.


  An amount of Rs.5,090 lakhs has been proposed for this sector during 2001-2002.

 8. 29. ART & CULTURE


Efforts will continue to preserve, protect and conserve the rich cultural heritage of the State. Research and documentation of vanishing forms of art will receive priority attention. Art consciousness and promotion of creative arts will be encouraged. With a view to preserve traditional art forms, a scheme known as 'Living Heritage' is being implemented.



The schemes for providing financial assistance to voluntary cultural organisations and festivals will continued. The Intensive Art and Culture Development Programme will be strengthened.



The Eleventh Finance Commission Award of Rs.40 lakhs for Heritage Protection and Rs.107 lakhs for strengthening and up-gradation of Public Libraries in the State will be utilised during 2001-02.


  An amount of Rs.348 lakhs is proposed for this sector during 2001-2002.



Endeavor to promote Sports & Games will continue. Development of sports infrastructure at village. Block and State level will be encouraged.



During the current, 11 schemes for development and up-gradation of Sports infrastructure have been completed. Implementation of 40 ongoing projects located in different parts of the State is making good progress.



Implementation of the Intensive Sports and Youth Development Programme will be accelerated.



An amount of Rs.696 lakhs has been proposed in the Budget Estimates for this sector during 2001-2002.



  The Health sector will continue to receive priority. During the current year, emphasis has been given up-gradation, extension and consolidation of the urban and rural health infrastructure.



Up-gradation of the Orthopedic and Rehabilitation Centre at the Shillong Civil Hospital is being implemented under NEC funding.



The ongoing construction of 8 Community Heath Centres, 16 Primary Health Centres and 5 Health Sub-Centres are expected to be completed during the current year.



Government have notified the Meghalaya AIDS Control Society for implementation of the World Bank sponsored programme for control of AIDS.



The Centrally Sponsored National Programmes for eradication of Malaria & Leprosy and Control of Blindness will continue.



The new Intensive Care Unit at the Shillong Civil Hospital is expected to the operationalised during the early part of 2001-2002.


  An amount of Rs.3437 lakhs has been proposed in the Budget Estimates, 2001-2002 for this sector.



The Central Government has fixed 2004 A.D. as the year within which the entire population should be provided with safe drinking water.



The programme for provision of safe drinking water to all human habitations will continue to be taken up under the PMGY and the Accelerated Rural Water Supply Programme.



During the current year, 150 uncovered habitations, 210 partially covered habitations and 35 iron-affected habitations are expected to be covered under the ongoing schemes and provided with safe drinking water supply. 



All Urban Centres in the State are provided with safe drinking water supply. Water supply augmentation schemes are under implementation at Shillong, Jowai, Tura, Williamnagar, Nongstoin and Cherrapunjee to cater to the increased demand for water. The Greater Shillong Water Supply Scheme is partially complete. The remaining work is in progress and likely to be completed during 2001-2002. The Central Government has released Rs.675 lakhs for this project under the non-lapsable pool of Central Resources, during the current year.



The construction of the Mass Gravity Concrete Dam over River Umiew at Mawphlang is progressing. The project is scheduled to be completed by March, 2002.



Under the Human Resources Development Programme, 844 persons have been trained till 1999-2000 in the operation and maintenance of water supply schemes. This will facilitate the handing over of completed water supply schemes to the village committees and ensure their subsequent maintenance.



An amount of Rs.4293 lakhs has been proposed in the Budget Estimates for 2001-2002 for this sector.




Efforts to provide adequate infrastructure and basic civic amenities in all the urban areas of the state will continue.



The ongoing construction of a Parking Lot near the District Council premises at Shillong is in progress and is expected to be completed during 2001-02. Likewise, construction of a Parking Lot near the Shopping Complex at Nongstoin is being initiated.



The construction of a Bus Terminal at Madanriting is expected to commence during 2001-2002. Land Acquisition proceedings for this purpose are being initiated.



The Shillong solid Waste Disposal Project is under implementation and is likely to be completed during 2001-2002.



Efforts are being made to expedite the setting up of the new Shillong Township. Land acquisition proceedings for the second phase are proposed to be initiated shortly.



Development works for construction of the Nongstoin Super Market have already been initiated. The project is expected to be completed during 2002-2002.



In order to ease the present congestion of traffic in Shillong. a multi-level parking-cum-commercial facility called the Shillong Central Complex is being set up at Police Bazar. Construction works will commence during 2001-2002.



An amount of Rs.3686.50 lakhs has been provided in the Budget Estimates during 2001-2002 for this sector.




During the current year, the allocation under this programme has been increased from Rs.20.00 lakhs to Rs.25.00 lakhs per Urban Assembly Constituency and from Rs.10.00 lakhs to Rs.12.50 lakhs per semi-urban Assembly Constituency.



Like the SRWP in rural areas, this programme has generated sustainable community assets and will continue as a major programme under the Urban Development Sector.




Guidelines for formulation, approval and implementation of the programme have been finalised. The programme will continue during 2001-2002.



The total number of employment-seekers on the Live Register of Employment Exchanges is 35,221. Of these, 85 candidates were placed in employment during the year and 40 candidates attended coaching classes in the coaching Cum-Guidance Centre.



The new Industrial Training Institute at Baghmara is expected to be made operational during 2001-2002.




The main activities under this sector include the implementation of schemes for the welfare of the Women, Children, Physically-Handicapped, Juvenile Delinquents, the Aged and Infirm.



131 physically-handicapped students supported with scholarships and 53 given vocational training in different trades during the current year. The Department also proposes to assist 90 physically-handicapped students with uniforms and Book Grants and 45 others with conveyance and Unemployment allowance.



823 Anganwadi workers and helpers, representatives from NGOs and Community leaders are being trained under the World Bank Sponsored project "UDISHA" during 2000-01.



The Supplementary Nutrition Programme for children and Expectant and Nursing Mothers will continue to be implemented in all Community and Rural Development Blocks. Under the new PMGY, the Department proposes to cover 1,09,656 malnourished children in ICDS areas and 16.461 in Urban areas.



The Central Government has sanctioned the establishment of new Observation-cum-Special Home at Tura. The programme for de-addiction and rehabilitation of drug addicts will be intensified.



The Centrally Sponsored Indira Mahila Yojana is currently under implementation within Mylliem Community and Rural Development Block. 73 Indira Mahila Kendras have so far been registered under the scheme. The Centrally Sponsored Balika Samridhi Yojana will also continue during 2001-2002.


8.36. POLICE


Within the operationalisation of the India Reserve Police Battalion, the man-power reserves of the State Police has been enhanced. We now have three Operational Battalions under the State Armed Police Force.



About 85 percent of the State Police Budget is spent on salaries. The remaining about is utilised for meeting basic requirements such as uniforms, rations, mobility and other related expenses.



66 units of Police Housing are proposed to be constructed during 2001-2002. An amount of Rs.340 lakhs has been proposed in the Budget Estimates for 2001-2002 for the purpose which includes amounts available under the award of the Eleventh Finance Commission.



Government is taking steps to modernise the State Fire Service and the Forensic Science Laboratory. The Department also proposes to set up mobile Forensic Laboratory Units in all the Districts of the State. Two units have been sanctioned during 2000-01.



The Government of India has been extending annual financial assistance to the State under the scheme of Modernisation of the State Police Force. In addition, the Central Government also provides assistance for modernisation of police force by providing vehicles, arms, ammunitions and communication equipments.




Construction of the Second Meghalaya House on land allotted by the Government of India at Vasant Vihar, New Delhi will be taken up shortly.



Construction of the new Meghalaya House at Kolkata is expected to be completed during the early part of 2001-2002.



Government also proposes to acquire 5 residential houses at Vellore from the Tamil Nadu Housing Board for establishing a Guest House for the convenience of Meghalayans.



Construction of Yojana Bhavan as an extension of the Main Secretariat is expected to be completed during 2001-2002.


  Construction of Circuit Houses at Khliehriat and Mawkyrwat is in good progress.



The Meghalaya Legislative Assembly Building which will long be remembered for its artistic beauty was gutted down by fire on January 9,2001. Construction of the new building will be taken up during 2001-2002.



The Government of Assam have allotted a plot of land measuring 7 big has at He4ngarabari, Guwahati to the State Government for construction of Meghalaya House. The plot was formally handed over to the State Government on 05.03.2001.



Three Plots of Defense Land measuring a total of 3.66 acres were handed over to the State Government on 12.10.2000. Steps are being taken to develop and convert these lands into public utilities for the benefit of the people of the state.




Information Technology has emerge as a promising sector in the Indian economy which is capable of generating large scale employment for the educated unemployment. The State Government proposes to tap this important sector for the benefit of the people, especially the educated unemployed.



Government is taking steps to create a Department of Information Technology and will ensure that this sector receives adequate support for its growth and development.




The information and Publicity sector will continue to strive for better public participation in the various developmental programmes of the Government through proper dissemination of information.



With a view to improve the information network and to create better awareness amongst the public, the Department will procure seven mobile audio-visual units, one for each district, during the current year.




The year 1999-2000 opened with a deficit of Rs.3613.38 lakhs. While the total receipts during the year including receipts under public Accounts amounted to Rs.14,16,480,42 lakhs, the corresponding expenditure was Rs.14,12,709,58 lakhs, resulting in a closing surplus balance of Rs.157.46 lakhs.



The revised estimates for the current year reflects an opening surplus balance of Rs.157.46 lakhs. While the revised estimated receipts during the year including receipts under Public Accounts are likely to amount to Rs.14,97,042.64 lakhs, the corresponding expenditure is expected to amount to Rs.14,94,310.27 lakhs, resulting in an anticipated closing surplus of Rs.2889.83 lakhs.




The estimates envisages an opening surplus balance of Rs.2889.83 lakhs and a total receipt including receipts under Public Accounts of Rs.15,40,284.54 lakhs against a corresponding expenditure including expenditure under Public Accounts of Rs.15,38,592.98 lakhs, resulting in an anticipated closing surplus of Rs.4581.39 lakhs.




Keeping in view the increasing revenue expenditure of the State, as a consequence of increasing debt service burden and spiraling establishment cost due to ever increasing market-price related emoluments of Government employees, and the requirement of fiscal reform to qualify for fiscal-reform related revenue gap grants, it is necessary for the State to generate additional resources. I therefore propose to give immediate effect to the under mentioned additional taxation measures -


i To increase the existing rate of Surcharge under Meghalaya Finance Sales Tax Act, the Meghalaya Sales Tax Act and the Meghalaya Purchase Tax Act from 5 per cent to 10 per cent.



To increase the existing rate of Surcharge under the Meghalaya Sales of Petroleum Products including Motor Spirit and Lubricants Taxation Act from two per cent to ten per cent, but excluding High Speed Diesel from such additional surcharge.


iii To impose a luxury tax of twelve percent on all varieties of cigarettes and cigars.



To impose a cess of Ten Rupees per metric ton on coal for generating additional resources for the development of education and other social services.



To impose a cess of Five Rupees per metric ton on limestone to generate resources for the development of education and other social resources.


vi To increase the rate of luxury tax on hotels and lodgings by the percent on all slabs.



To impose a one time cess of Rs.500 per mobile phone connection including existing connections.



To increase the driving license issue fee from Rs.150 to Rs.250 and a driving license renewal fee from Rs.15 to Rs.50.



However, with a view to provide some incentive to the construction of quality dwelling houses and other buildings, it is proposed to decrease the rate of sales Tax on Paints, colours, lacquers, varnishes, including glue, polish, turpentine thinners, putty, enamels and indigo, from 16 percent to 8 percent.



The aforesaid measures are expected to generate additional resources exceeding Rs.1000 lakhs during the year 2001-2002.



In conclusion, it is my sincere expectation that with the fullest support of all sections of this august House, the Budget proposals that I have presented today, are unanimously carried and effectively implemented, to ensure generation of conditions favorable to accelerated and harmonious growth of the State economy, to fulfill the rising expectations of every Meghalayan.



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


                                                                            KHUBLEI, MITHELA, JAI HIND.