Government of Mizoram
Budget Speech: 1995-96
By Pu Lalhmingthanga
Finance Minister
Mr. Speaker Sir,
With your permission, may I now rise to present the
Mizoram Budget for 1995-1996 to this august House?
2. Before presenting the Budget as such, I may dwell
a little on the general economic scene. As you know, Sir, a strong
wind of drastic reforms on the economic front is sweeping the country
since 1991 in the form of liberalization, de-regulation and globalisation.
Unfortunately, these reforms have not proceeded at eh desired pace
manifesting, of late, in some unpleasant symptoms like re-emergence
of double-digit inflation causing hardship to the masses at large.
Need has, therefore, been felt for giving human fact to the reforms
process. However, there is nothing to cause concern. The path of progress
is never straight situation only demands from us to look back and
proceed with renewed vigour in the long-term interest of the country.
3. The reforms process can never be a success without
the active co-operation of the States. It has cast on the States very
heavy responsibility. According to Prof. Raja J. Chelliah, an eminent
economist and presently Fiscal Adviser to the Union Finance Minister,
some of the steps to be taken by the State Governments to facilitate
and promote the reforms process are:
(a) Widening of the tax base and reform of the tax
system, in particular, indirect taxes in a manner that avoids taxation
of inputs or escalation of costs, and barriers to trade between States.
This requires adoption of the value-added tax (VAT), greater uniformity
in sales tax rates, abolition of what is called "rate war"
and general agreement amongst States on the concessions to attract
investment in backward areas.
(b) Restoration of the budget balance by phasing
out the deficit during the next five years or so. This would require
bold steps to stop the growth of the non-development expenditure.
Simultaneously, the Government should get out of many areas and open
them up to the private sector. Closing down of the loss-making public
sector undertakings and those which have no promotional aim is an
important imperative.
(c) Infra-structure development and improvement,
especially in power and roads.
(d) Streaming of procedures so that industry can
obtain speedy clearances and approval.
(e) Reforms and strengthening of local administration,
particularly of growing towns, including reform of local taxation
and larger devolution ofpower and funds to it.
This transformation can be brought about through
the doctrine of "State sponsored collective self-reform".
4. We regard the above measures as unexceptionable
and resolve to so refashion our economic and fiscal policies as to
subserve this transformation process to the maximum.
5. Mizoram is a poor State with the majority of the
population living below the poverty line. There is required a massive
effort at development for a turn-around in a given time-frame. This
task cannot be accomplished without creating in the State a congenial
atmosphere for investment and production. Public investment alone
would not do. While all this requires education and a change in the
attitude of the people in general, a change in the approach and attitude
of political leadership is also necessary.
PLAT EFFORT:
6. As against the Eight Plan (1992-97) target of
Rs. 763 crore, the plan outlay in the first two years (1992-94) amounted
to Rs. 342 crore. For the third year (1994-95), the size of the State
Plan was fixed by the Planning Commission at Rs. 207.66 crore. However,
we could not avail of the assistance of Rs. 10 crore for the externally-aid
projects and of Rs. 5.25 crore from the Infra-structure Leasing and
Financial Services Ltd. on the other hand, the Commission made a Special
allocation of Rs. 10 crore in the current year for initiating the
work on the construction of the Lengpui airfield. With this, the outlay
on the State Plan in the current year is anticipated at Rs. 202.41
crore.
7. Sir, I would be failing in my duty if I do not
congratulate, on behalf of this august House, our Hon’ble Chief Minister
for the success of his untiring efforts to make Government of India
agree to meet our long-felt need of constructing an airfield at Lengpui.
I must thank the Government of India also for this. When operational,
this would go a long way in opening up the State to a wider world
and promoting investment.
8. For the next year (1995-1996), the Planning Commission
approved an outlay of Rs. 227 crore, representing a step-up of over
12 percent over the anticipated outlay in the current year. In framing
plan proposals, we have followed the strategy suggested by Planning
Commission and identified the following major trust areas:
(a) Agriculture with emphasis on elimination of ‘Jhuming’
self sufficiency in foodgrain and promotion of horticulture;
(b) New Land Use Policy (NLUP) aiming at complete
eradication of shifting cultivation through provision of alternative
permanent settlement of ‘Jhumis’ families;
(c) Generation of power for meeting the huge gap
between production and demand through internal generation;
(d) Achievement of full literacy;
(e) Provision of drinking water and communications
in rural areas; and
(f) Employment generation through agro-forest based
industries.
9. The board sectoral allocation of the outlay of
Rs. 227 crore on the State Plan in 1995-1996 is as under:
(Rs. In crore)
1.
Agriculture and allied activities 21.90
2. Rural Development
37.35
3. Irrigation and
Flood Control 7.52
4. Energy
30.00
5. Industry &
Minerals 9.90
6. Transport and Communications
33.47
7. District Councils
11.46
8. Education and allied
activities 13.25
9. Medical & Public
Health
7.87
10. Water Supply &
Sanitation
12.70
11. Urban Development
(incl. Capital project) 14.15
12. Civil Aviation
10.00
13. Other minor sectors
17.12
TOTAL:
227.00
10. Let me express my sincerest gratitude to the
Planning Commission for its magnanimity in providing Central assistance
(Rs. 242.03 crore) in excess of the next year’s Plan. This marks in
a way reversion to the pre-1987 practice, as demanded by the State
Government, to take the non-Plan account also into consideration while
determining the level of Plan assistance.
11. The assistance provided by the Planning Commission
for the next year’s plan budget includes Rs. 15 crore earmarked for
the externally-aided projects and Rs. 10 crore each for the Capital
project, Serlui ‘B’ Hydel Project and Lengpui airfield. We have identified
the schemes/projects and hope to utilize the Externally Aided Project
(EAP) assistance this time fully.
12. The Agriculture and Allied Sectors including
Rural Development with over 26 percent of the total outlay continue
to enjoy the top-most priority. The transport and Communications Sector
is proposed to be given a big boost with allocation representing a
step-up of over 34 percent over the current year. The Power Sector
also continued to occupy an important place with an outlay of Rs.
30 crore next year. It is also heartening to note that the three District
Councils have an allocation of Rs. 11.76 crore, apart from Rs. 1.23
crore allocated to the Singlung Hills Development Council being constituted.
In the Social Services Sector, education and water supply have prime
place with outlays of Rs. 136.25 crore and Rs. 12.70 crore respectively.
The latter sector may have an additionality of Rs. 10 crore out of
the assistance earmarked for externally-aided projects.
13. A booklet on ‘Highlights’ of the performance
in 1994-1995 and Programmes of various departments in 1995-1996 has
been circulated separately to the honourable members along with the
Budget documents. If you permit, Sir, I may briefly cover come of
the important developments.
14. The rural development including agriculture and
allied activities, power and roads & bridges are the three most
important areas of the State’s development programmes. Special mention
may be made of the sizable provisions of Rs. 24.97 crore in 1994-1995
and of Rs. 25 crore in 1995-1996 set apart for the New Land Use Policy
(NLUP) designed to wean away people from ‘Jhuming’. The power sector
on which an amount of Rs. 27.47 crore was spent in 1994-1995 has been
given an allocation of Rs. 30 crore for 1995-1996. The construction
of Maicham Mini Hydel Project has been completed and the preliminary
work on Teirei and Tuipanglui Hydel Projects has been taken up. Besiders,
Ku-Tlabung Mini Hydel Project (4.5 MW), Maicham Statee II (2MW), Ngengrual
(2MW) and Tuiphal Projects are proposed to be taken up next year.
As regards transmission, the Lunglei Sub-Station (132 KV) was commissioned
in November last and the work on five more 132 KV lines is in progress.
As many as 592 villages are expected to be electrified by the end
of this year.
15. The roads and bridges sector on which an amount
of Rs. 23.19 crore was spent this year has been allotted Rs. 22 crore
next year. In 1994-1995, 84.64 KM of formation cutting, 41.77 KM of
soling and 52.76 KM of black topping was completed. The programme
for 1995-1996 includes 111.04 KM of formation cutting, 81.50 KM. of
soling and 149.30 KM of black topping. While on this sector, I may
make mention of the emphasis being laid by the Government on developing
alternative road link of the State with the outside world. Speedy
develo0pment of the 140 KM long Seling-Tipaimukh road connecting the
State with Manipur assumes and added importance looking to the problems
the State had in the recent past. As regards road transport, 6 new
Buses were purchased next year.
16. One notable scheme to which I would like to make
special mention of is regarding the Lengpui airfield. An allocation
of Rs. 10 crore each has been made for this project in 1994-1995 and
1995-1996. The work on this project is expected to be taken up soon.
17. A State Soon Farm was established at Chemphai
in 1994-1995 and a Veterinary College under the Central Agriculture
University is proposed to be set up during 1995-1996. The Forest Department
took up afforestation of 14,070 hectares of land in 1994-1995d and
proposes to cover 9,600 hectares of more land next year.
18. With a view to providing the requisite infrastructure
to industries, special attention is being paid for the development
of industrial estates and industrial growth centres. The Zuangtui
Industrial Estate is already functional and the Vertical Industrial
Estate is in the final stage of completion. The Industrial Growth
Centre at Luangmual involving cost of rs. 25 crore is expected to
get approval of Government of India soon. The scheme for payment of
central transport subsidy to encourage small scale industries continues
to make progress. While on this sector, I would like to make a special
mention of the tea industry. This industry has the potential of turning
the fact of the economy of the State in a big way. I am happy to say
that good progress has been made in this area. A nursery with about
13 lakh tea-seedlings has been raised at Luangmual. Two more nurseries
are being start next year. The Construction work on the tea processing
unit is also expected to start in 1995-1996.
19. The social services sector continued to be assigned
an important place in our development programmes. In 1994-1995, three
new Sub-Divisional Education Offices were opened at Aizawl, Serchhip
and Lunglei West. 10 unaided Middle Schools and 5 unaided High Schools
are proposed to be upgraded to deficit status next year. The Art and
Culture Department which organized several cultural shows within and
outside the State, proposes to take up a multi-purpose cultural complex
for the preservation of the cultural heritage of Mizo. It also extended
grants-in-aid for a research project on the Mizo Hisotory. As regards
sports, the State participated in the 27th Junior National
Boxing Championship held at Guwahati in November, 1994 in which a
boxer from Mizoram, winner of Gold Medal, was declared as the best
boxer. Further, a Mizo archer represented India in the 12th
Asian Games held at Hirosima in Japan and the Mizoram football team
won the King’s Cup at Thimpu, Bhutan, in September, 1994. I extend
my heartiest congratulations on behalf of this august House, to all
the sportsmen and women who brought glory to the country at large
and Mizoram inparticular.
20. The Health Department gave priority health care
in rural areas. In 1994-1995, construction of one Community Health
Centre at Ngopa and two Primary Health Centres at Sairang and Khawhai
was completed. Four more PHC buildings are nearing completion. Next
year, apart from completing buildings for Community Health Centre
(CHC) at Vairengte and Saitual and 6 more Primary Health Centre (PHC)
buildings, a 30 bedded CHC will be established at Sakawrdai. Coming
to hospitals, the administrative wing of the Aizawl Civil Hospital
will be fully operational next year. The establishmewnt of a mental
Hospital is also proposed to be taken up. As regards family welfare,
the State, I am proud to say, exceeded the target fixed by the Government
of India for sterilization, IUD insertion, etc.
21. The Lunglei Water Supply Scheme partially operated
in 1994-1995 is expected to be fully commissioned shortly. The Greater
Serchhip Water Supply Scheme made good progress and the work has been
started on the Kolasib Scheme. Phase –II of the Greater Aizawl Water
Supply Scheme is proposed to be started next year. It is also proposed
to launch, with external aid, an integrated project for Aizawl covering
sewerage, solid waste management, water quality monitoring and public
health education. As regards augmentation of rural water supply, 36
habitations were already covered in the current year and 40 more are
proposed to be covered next year.
22. As regards the Revenue Department, the cadastral
survey which is in progress in the state completed the work in four
rural towns in 1994-1995 and is expected to cover three more next
year. In respect of House Site Plan also, four rural towns were covered
in the current year and three more would be taken up in 1995-1996.
The Accounts and Treasuries Department completed the GPF account of
Government servants for the year 1993-1994.
23. Under the scheme "Integrated Development
of Small and Medium Towns", the Government of India approved
the projects of Serchhip and Kolasib towns. The Local Administration
Department successfully conducted general elections of 358 village
councils in Aizawl District and 121 village councils in Lunglei District.
Another achievement of this Department to which I would like to make
mention of is the loan of Rs. 5 crore being obtained from Housing
& Urban Development Corporation (HUDCO) for disbursal as house-building
advances to Government employees.
24. Sir, as you know, the three Autonomous District
Councils have been assigned more powers and funds for carrying out
the larger role entrusted to them. An allocation of Rs. 11.76 crore
has been made to them under the annual plan for 1995-1996, apart from
the non-Plan Budget of Rs. 9.60 crore. A token provision has been
made next year for re-organisation of districts also.
25. It is a matter of pride that the insurgency in
the northern part of the State has ended. Apart from other measures
for normalization, the Sinlung Hills Development Council is being
constituted and a plan allocation of Rs. 1.23 crore made to it for
1995-1996.
26. The Excise Department, in collaboration with
the Police Department continued their vigorous efforts at combating
illicit drug-trafficking and abuse. During the current year, 111 drug-traffickers
were arrested and 50,069 capsules of Proxyvon, 4876 bottles of Phensydyl,
46 Kgs of Ganja, 251 Grams of heroin and a huge quantity of illicit
liquor were sized. Certain sections of the Drugs and Cosmetics Act,
1940 are being amended to make it more effective.
27. Lastly, a word about the Finance Department.
The Department has done exceedingly well on lotteries and small savings.
The receipts from state lotteries in the current year are expected
to be more than double of the Budget estimate. In regard to small
saving collections also, the target of Rs. 4.65 crore has been exceeded.
REVISED ESTIMATES FOR 1994-1995
28. According to the Reserve Bank account, the year
1994-1995 opened with a deficit of rs. 31.92 crore. This was only
slightly higher than the deficit of Rs. 31.57 crore envisaged in the
Budget Estimates. However, as per Revised Estimates, during the year
transactions revealed an over-all deficit of Rs. 9.70 crore against
the budgeted deficit of Rs. 4.24 crore. This deterioration could be
attributed entirely to the additional expenditure of about Rs. 15
croree on two installments of Dearness Allowances (DA) effective from
1.1.1994 for which no provision had been made in the budget estimates.
But for the sacrifice made by our employees through impounding the
bulk of the additional D.A., our position would have worsened further.
I must thank the employees for this.
29. As per the Revised Estimates, the current year
is likely to close with a deficit of Rs. 41.62 crore. Though big,
it is only two – third of the deficit estimated by the Planning Commission.
Sir, with your permission, I must say with all humility that this
difficult task was accomplished by the Finance Department by being
somewhat unpleasant to most departments. We realized that only self
discipline would save us from the fiscal disaster we were heading
to. The task is, however, in no way complete and will have to bee
carried forward to reverse the trend of budgetary imbalance.
BUDGET ESTIMATE FOR 1995-1996
30. In view of what I have said, my first and foremost
concern in framing the Budget for the year was to take steps to reduce
the opening deficit of Rs. 41.62 crore to the utmost extent possible.
With all the modesty at my concerned, I claim to have succeeded quite
a bit in this task. I am most happy to present a surplus Budget. My
Budget shows an overall surplus of Rs. 8.72 crore against a deficit
of rs. 9.70 crore as per the Revised Estimates for the current year,
showing the improvement of Rs. 18.42 crore. It is especially creditable
in view of the fact that the total central support assumed for next
year is rs. 13.88 crore less than that in the current year. Such an
improvement was possible as a result of drastic cuts in non-Plan expenditures.
This was no easy a job and could be accomplished only with the full
co-operation of all the departments. I appeal to them through this
august House to help me to maintain the trend during the year.
31. The Budget Estimates place the revenue receipts
at Rs. 515.96 crore and revenue expenditures at Rs. 430.05 crore,
showing a surplus of Rs. 85.91 crore on Revenue Account. However,
with a huge deficit of Rs. 81.81 crore on Capital Account, the Consolidated
Fund revealed a small surplus of Rs. 4.10 crore only. This was augmented
by Rs. 4.62 crore on account of Public Account trasactions. In over-all,
the Budget places the surplus at Rs. 8.72 crore, reducing the opening
deficit to rs. 32.90 crore.
32. I am deliberately not making extra provision
in the Budget for the two installments of D.A. which may fall due
next year, in the hope that this burden would be accommodated by most
of the departments through economy in their normal Budget allocations
or through a scheme of impounding to the extent necessary.
33. Sir, as you know, our Budget is heavily dependent
on Central dispensation. In so far as non- plan account is concerned,
this dispensation from the next year (1995-1996) is to be in terms
of the award of the Tenth Finance Commission. However, as the recommendations
of this Commission were not known while preparing the Budget, the
Budget had to be prepared on the basis of the award of the Ninth Finance
Commission. With the improvements as per the award of the Tenth Finance
Commission, the bulk of the remaining deficit, if not all, is expected
to be covered, putting the State’s finances more or less on an even
keel. Once this his achieved, our scared job should be to make all
efforts to maintain this position through learning to live within
our means.
34. For funding of the State Plan in 1995-1996, the
State Government has undertaken to mobilize additional resources of
Rs. 20.61 crore through various measures including impounding of D.A.
For the present, I am not proposing any measure for this purpose.
After the report of the Mizoram Resource Mobilisation and Taxation
Enquiry Committee which is in session, becomes available. The Government
may come up with proposals during the course of the year, for raising
additional resources.
35. Last, but not the least, I would like to express
may sincere thanks to the officers and staff of all Departments, especially
the Finance Department and the Government Press, with whose unstinted
co-operation alone I have been able to present my Budget to this august
House in time.
36. Mr. Speaker, Sir, I think you an all the members
of the House for giving me patient hearing and attention, I earnestly
appeal to them to give me benefit of their thought on my proposals.
37. With these words, Sir, I commend the State Budget
for 1995-1996 for consideration and approval of this august House.
Thank you, Sir.
