News & Information From Northeast India

Meghalaya CM tables deficit budget, announces development budget of Rs 8,616 crore

Meghalaya Chief Minister Conrad Sangma tabled a fiscal deficit budget of Rs 1,532 crore for the 2020-21 fiscal on March 19 with no new tax.

Presenting the budget, Sangma who also hold the Finance portfolio, announced a development budget of Rs 8,616 crore for 2020-21.

“We have increased the development budget from State’s resources to Rs 3,300 crore for 2020-21, a 45 percent increase over the previous financial year and the largest in the history of the state,” he said.

Sangma said that the development budget from State’s resources has never crossed Rs 2,600 crore in the past five years. Voicing confidence that the revenue collection of the state would improve significantly in the next fiscal year, Sangma estimated a revenue collection of Rs. 2,377 crore and Rs 690 crore from tax and non-tax.

The fiscal deficit of Rs 1,532 crore, which is around 3.53 per cent of the Gross State Domestic Product (GSDP), he said.

Sangma informed that the 15th Finance Commission, which is mandated with recommending the devolution for the five-year period, 2020-25, has increased Meghalaya’s share of the total divisible pool from the previous 0.642 to 0.765 percent.

For the next fiscal year, Sangma estimated the total receipts are estimated to be Rs 15,380 crore excluding borrowings of Rs 1,995 crore.

He said excluding repayment of loans of Rs 520 crore, the estimated total expenditure is 16,912 crore.

The CM said the interest payment for the next fiscal year is estimated at Rs 843 crore and pension payments at Rs 1,208 crore.

“We have prioritized improving our own tax and non-tax revenues. We have approved the State lottery rules in December, 2019 for conducting both paper and online lottery and the process of operating the lotteries is being finalized. I am personally monitoring the revenue collection through periodic review meetings,” Sangma said.

He said that steps have been taken to increase excise revenue through reducing inefficiencies. Brands have been re-categorized and the ad valorem duties have been revised accordingly.

“A policy for prepayment of ad valorem duty has been introduced. Revenue enhancing measures continue to be implemented in the transport sector as well,” he informed.

Moreover, he said the government has taken several measures for the improvement of non- tax revenues with new improved mineral transport challans with multiple security features like hologram, fugitive ink and QR codes have been introduced. Sangma said the revenue collected by the taxation department is expected to touch Rs 1,632 crore and the overall tax revenue, including Goods and Services Tax, Excise and Motor Vehicle Taxes for 2019-20 will reach Rs 2,015 crore.

For the year 2020-21, he said government is putting in place a full system of data analytics to aid in increasing the efficiency of revenue collection.

Off the total grant of Rs 7,417 crore recommended by the 15th Finance Commission for 2020-21, Sangma informed that Rs 6,542 crore is the tax devolution, Rs 491 crore is the revenue deficit grant, Rs 182 crore and Rs 88 crore are grants to rural and urban local bodies respectively, Rs 66 crore is State Disaster Risk Management Fund and Rs 48 crore is the grant for nutrition.

In his budget speech, the chief minister spoke of various ongoing initiatives for infrastructure development, entrepreneurship promotion, poverty alleviation, sustainable rural livelihoods and social security and welfare.

Prioritising human development – education and the health at the crore, the chief minister announced Rs 1,050 crore for the education sector, an Rs 2.5 crore specifically for a state-wide Meghalaya’s Outcome oriented Transformation in Heath, Education and Rural Development (MOTHER) programme.

The budget for Health and Family welfare has been increased to 22 percent with an overall proposed outlay of Rs 724 crore for the next fiscal year, Sangma announced.

With the year 2020 declared as the ‘year of the farmer’, the budget proposed Rs 540 crore for agriculture and the allied sectors, including Rs 241 crore from state’s resources and a total of Rs 2,882 crore for infrastructure development.

For the urban sector, Rs 199 crore has been allocated and Rs 10 crore for state’s flagship programme – PRIME (Promotion of Innovative and Market-Driven Enterprises).


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