Though the BJD Government is crying foul over ignoring the State in granting special financial assistance as gifted to Bihar, West Bengal and Andhra Pradesh by Finance Minister Arun Jaitely in Union Budget 2015-16, Odisha could still stand to gain more on bridging the rural-urban divide. However, one more heartburn moment for the State is non-inclusion of world heritage site — Konark — in the extra resource provisioning measure announced in the Budget to boost living conditions of the local communities surrounding the sites. Incidentally, Konark area is characteristically rural and poor in the State.
According to the Fourteenth Finance Commission Report, Odisha is close second to Bihar with around 84 per cent population living in rural areas compared to 86 per cent in Bihar. However, the 66th National Sample Survey report released last year revealed that the monthly per capita expenditure (MPCE) of rural people in Odisha is lowest in the country. The MPCE of urban Bihar is lowest in India but the rural-urban divide in MPCE in Bihar is only 34 per cent compared to a whopping 94 per cent in Odisha. This underlines the poor income generating opportunities in rural Odisha compared to that of Bihar, where income generation is poor in both rural and urban areas.
The Budget 2015-16 has earmarked a whopping around Rs 79, 526 crore for rural development activities to tide over the divide. Moreover, the launch of Prime Minister Mudra (Micro units development refinance agency) Yojana could work wonder in Odisha to boost its sagging rural economy. As rural Odisha has around 70 per cent proprietary based micro units, the availability of institutional finance could boost up entrepreneurial activities and per capita income in the State that is currently lacking in. Again the people dependent on farming is highest in Odisha; the phenomenal increase in allocations under micro irrigation, watershed development and PM Krishi Sinchai Yojana could serve the State’s purpose provided the State Government genuinely works towards tapping the schemes.
It is pertinent to note here that till today, the State has availed a whopping around Rs 11,600 assistance from Nabard under the Rural Infrastructure Development Fund (RIDF) to provide rural connectivity, irrigation, rural infra, ware housing facilities and rural drinking water supply. Finance Minister Jaitley has significantly raised the allocation for RIDF to Rs 25, 000 crore in 2015-16. Moreover, the spike in allocation to Rs 45,000 crore under short-term cooperative rural credit refinance fund could work better for the State’s cause as it will refinance the financially unsound PACS (primary agricultural credit socities) and lAMPS (large sized adivasi multipurpose credit societies) that lend short-term credit to small and marginal farmers far higher than commercial banks could do. Notable fact here is Odisha is third in the country to have highest farming land under marginal farmers. Since the State has adopted the Vaidyanathan Committee recommendations, it is eligible to get refinance where Centre shoulders over 84 per cent of the restructuring share.
Hits and Misses in Union Budget 2015-16 for Odisha
HITS
Specific announcement of setting up National Institute of
Science and Education Research
Misses
No special financial assistance to Odisha
Non-inclusion of Konark in special assistance to World Heritage sites
Non-inclusion of Odisha in Dedicated freight corridor map
Opportunities
Phenomenal boost to Rural Development Fund, RIDF,Short-term Cooperative Rural Credit Refinance Fund - all could prove a
booster dose to the 2nd largest rural populace of Odisha in country