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Significant Implications

February 7, 2024
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The presentation of the Revised Estimates for 2023-24 and the Interim Budget 2024-25 of the Government of Jammu and Kashmir has significant implications for the Union Territory’s fiscal landscape. Union Finance Minister Nirmala Sitharaman brought these proposals before the Parliament on Monday. The Finance Department of the UT had drafted the Supplementary Budget for the current year and the Interim Budget for the next financial year. For this, the Department had assessed the revenue receipts of the UT Government from GST, motor spirit tax, excise, and stamp duty. Further, the non-tax revenue from electricity and water supply, mining royalty, timber sales, annual rent from industrial lands, etc were also examined. The own revenue of the UT Government has been estimated at Rs. 20,867 crore. The UT Government also pursued the Government of India for getting central financial assistance. Now, the Central Government has committed to providing ₹41,751.44 Cr to the UT Government in the current financial year and ₹37,277.74 Cr in the next financial year. This assistance, captured in the Revised Estimates of 2023-24 and the Budget Estimates of 2024-25, includes normal assistance (resource gap) and equity contribution for hydropower projects. Building upon this central support, the Government of Jammu and Kashmir formulated the Supplementary Budget for 2023-24 and the Vote on Account for 2024-25. The Supplementary Demands cover additional requirements for specific departments, including Finance, Power Development, Hospitality and Protocol, and Cooperatives. These demands cater to essential needs such as debt repayment, power procurement, infrastructure development, and cooperative initiatives. The Interim Budget for 2024-25 reflects a comprehensive vision for ongoing initiatives, spanning infrastructure development, sustainable agriculture, new industrial estates, PRI level works, employment generation, tourism development, and social inclusion. The budgetary process involved extensive consultations with various departments and stakeholders to ensure realistic budgetary allocations aligned with the UT’s developmental goals. With an estimated budget of ₹1,18,728 Cr for the next financial year, the UT Government proposed a Vote on Account for ₹59,364 Cr. The interim budget allocates ₹40,081 Cr for revenue expenditure and ₹19,283 Cr for capital expenditure, catering to a wide array of ongoing measures and schemes. Some key provisions in the interim budget include initiatives for tap-water connectivity, transforming agriculture, rejuvenating school education infrastructure, improving road connectivity, strengthening decentralized governance, and enhancing infrastructure and services in the health sector. Additionally, provisions have been made for rural housing, comprehensive social security coverage, equity in hydroelectric projects, capitalization of banks, development of new colleges and universities, women empowerment interventions, construction of transit accommodations, and the development of industrial estates and related infrastructure. The two Appropriation Bills on the Supplementary Demands for 2023-24 and Vote on Account for 2024-25 are scheduled for discussion in the Lok Sabha and Rajya Sabha from February 7 to 9. These legislative deliberations are set to play a positive role in shaping the financial trajectory and developmental landscape for the union territory of Jammu and Kashmir in the coming years.

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