The Hindu Business Line : Isaac hopes to contain fiscal, revenue deficits

Thiruvananthapuram March 12 The Finance Minister, Dr Thomas Isaac, has said that he hopes to contain the fiscal and revenue deficits to within the revised Budget estimates at the end of the current fiscal.

Replying to questions in the Assembly on Monday, he said that the State was in the throes of a major financial crisis. He attributed this to spiralling non-plan expenditure, reduced share from the small savings pool and unexpected drag in tax and non-tax revenue realisations.

According to the revised Budget estimates for 2006-07, revenue receipts would amount to Rs 19,140.04 crore and revenue expenditure to Rs 24,554.82 crore. The revenue deficit would be Rs 5,414.78 crore, with fiscal deficit at Rs 7,534 crore.

Dr Isaac said that the Government had taken a number of steps to ramp up tax realisation as well as to cut down on avoidable expenditure. This is expected to lead to reduction in revenue deficit.

Implementation of the Eighth Pay Revision Commission recommendations, made worse by peaking interest rates of late, are feared to drive up non-Plan spending further.

ELECTRICITY OUTPUT

At least 500 MW would be added to the State's installed capacity by 2010-11, according to Electricity Minister Mr A.K. Balan. Construction on power projects required to produce an incremental 500 MW would be initiated afterwards, he said.

Power connections would be provided to 2.57 lakh applicants during 2007-08.

The remaining applications would be dealt with expeditiously.

In any case, the Rural Electricity Policy enjoins upon the State Government to provide electricity for all by 2009, the Minister said.

Replying to a question, the Minister said that a special committee had been set up to recommend ways to retain the Kerala State Electricity Board as a single entity in the public sector.