Karnataka Chief Minister Siddaramaiah in his fourth all-please Budget presented on Friday focused mainly on agriculture sector announcing formation of Special Agricultural Zones in different parts of the State along the lines of the Special Economic Zones that are formed for industry. The SAZs will focus on effective techniques for productivity, extending better technology and organic farming. In his Budget, Siddaramaiah announced higher taxes on Petrol, diesel and Indian Made liquor (IMl), which mainly focuses on agriculture and development of Bengaluru.
Siddharamaiah announced the formation of “Karnataka State Agricultural and Farmers Committee” under his chairmanship to redress grievances of farmers and converge schemes of agriculture and other departments. One hundred villages in four districts across four revenue divisions would be developed as model agricultural villages under the “Suvarna Krishi Grama” programme, he said. The Government will implement “Karnataka Raitha Suraksha Pradhan Mantri Fasal Bima Yojana” to help farmers during crop loss, for which the State would provide `675.38 crore as its share. The Government would also open up opportunities for private agricultural universities and agricultural colleges, he said.
Siddaramaiah said for the first time, 103 primary agricultural markets had been connected on an electronic platform to Unified Market System, through which agricultural commodities of `17,500 crore had been transacted from February 2014 till date.
He also announced “Indira Suraksha” Scheme to provide integrated healthcare services to the families of farmers who commit suicide. In the Budgetary proposals, the Government also decided to continue the scheme of disbursing short term agricultural loans up to `3 lakh at zero interest rate and medium and long term agricultural loans up to `10 lakh at 3 per cent interest. It targets disbursing `11,000 crore as agricultural loans to 23 lakh farmers during 2016-17.
Chief Minister Siddarmaiah, who holds the Finance portfolio, also raised the Value Added Tax from 14.5 per cent to 20 per cent on aerated and carbonated non-alcholic beverages.
Tax exemption has been retained on paddy, rice, wheat, pulses and products of rice and wheat for one more year. He also exempted VAT on processed ragi, Jowar Roti, native food of north Karnataka and Ragi Roti, native food of south Karnataka, aluminium household utensils, barring pressure cooker and cutlery, and handmade paper and paper boards.
Noting that Karnataka had not raised the tax on diesel and petrol in the middle of the year and passed on the benefits of fall in international crude oil prices, he proposed hike in tax rate on petrol from 26 per cent to 30 per cent and diesel from 16.65 per cent to 19 per cent. This would increase the price of petrol by Rs 1.89 per litre and diesel by 98 paise per litre, he said, adding that the measure was being taken keeping the state resources in mind for the welfare needs.
For Bengaluru, Siddaramaiah announced Rs 5,000 crore as Chief Minister’s special package, including developing roads of 1,500 km to provide alternative routes within the road network and all round development of IT-BT hubs in the city. He sought a Vote on Account for the expenditure up to July 31, 2016. The Budget noted that the Gross State Domestic Product in 2015-16 grew at 6.2 per cent as against 7.8 per cent during 2014-15, which was attributable to decline in growth in agriculture sector.
On the IT and BT sectors, the Budget proposed setting up of four technology business incubators in potential areas of Internet of Things, electronics systems design and manufacturing, robotics, 3D printing, nanotechnology, medical devices, health technology and clean technology in phases across the State.
The total Budget size of 2016-17 is pegged at Rs. 1,63,419 crore, of which the plan size is fixed at Rs. 85375 crore, an increase of 17.6 per cent over the plan size of Rs. 72,597 crore during the last year. Of the 1,63,419 crore, the estimated revenue receipts is pegged at Rs. 1,30,758 crore and capital receipts at Rs. 31,198 crore including borrowings of Rs. 31,036 crore. The fiscal deficit is expected to be Rs. 25,657 crore, which at 2.12 per cent of GSDP, complies with the Karnataka Fiscal responsibility Act.