As the second largest state economy in India, Tamil Nadu occupies such a position as to attract attention with its Budget exercise every year. Boasting of a finance minister with the highest credentials in terms of exposure to financial management expertise and familiarity with micro and macro economics, the State is expected to show the way with regard to giving direction. In presenting his third Budget, PTR Palanivel Thiaga Rajan may have outdone previous efforts.
A commendable social impetus is on the anvil with the scheme to give a monthly grant of Rs 1,000 to eligible women that is set to take off soon. Though a freebie, this reveals empathy for the more prudent members of families eternally struggling to make ends meet as costs soar and jobs dwindle. Beyond looking after an important segment of the population, the Budget has many attractive elements to it with its focus being as much on healthcare, education and skilling as providing for a big infra push in energy and setting up metros for the second and third biggest cities of Coimbatore and Madurai.
There is an even spread of such facilities as tech parks and factory skill schools across the state to increase employability with centres beyond the capital Chennai getting a due share. The need to shore up the electricity board with subsidies as well as capital expenditure to increase power production through a mega power project for a power thirsty state has also been recognised.
Where the finance minister may have produced magical skills is in kicking off reform initiatives that have reduced the revenue deficit from a whopping Rs 62,000 crore by about Rs 3,000 crore a year for the State. The promise to contain the fiscal deficit to within 3 per cent of GSDP for the current year despite the huge weightage given to welfare spending to sustain the social objectives of the Dravidian model of governance is a challenge that has been accepted, even if any rise in the State’s own tax revenue is only marginal.
