The newly-elected Bhupendra Patel government in Gujarat presented a ‘no-tax’ budget for 2023-24 with surplus of ₹916.87 crore even as the budgetary allocations increased by 23 per cent to ₹3,01,022 crore for the fiscal.

Presenting the Budget in the State Assembly in Gandhinagar on Friday, State Finance Minister Kanubhai Desai said, “The adverse impact on the economy of the state has subsided significantly due to various measures taken by the Government of Gujarat. The economy of state has regained its growth momentum,” while proposing no changes in existing tax rates and no new taxes for the year “to further accelerate growth of the state.”

The developmental expenditure for 2023-24 is estimated at ₹1,91,010 crore and non-developmental expenditure is projected at ₹1,04,949 crore for the year. During the year, the government intends to raise ₹68,000 crore in public debts.

The state’s gross public debt position as on March 31, 2023 is estimated to be ₹3,39,683 crore, which works out to 15.02 per cent of the GSDP. The estimates suggest this to be the lowest rate of gross public debt-to-GSDP in more than a decade. Also, the cost of debts has improved since 2004-05 from 10.79 per cent to 7.75 per cent in 2021-22 and is expected to be 7.63 per cent in 2022-23 (RE).

In its medium term fiscal policy statement, the Gujarat government has estimated public debt to increase to ₹3.81 lakh crore for 2023-24, ₹4.33 crore for 2024-25 and ₹4.80 crore for 2025-26 with public debt as percentage of GSDP at 14.88 per cent, 14.92 per cent and 14.59 per cent, respectively.

The GSDP is projected to increase from ₹22.62 lakh crore (revised estimate) for 2022-23, to ₹25.63 lakh crore in 2023-24 and ₹33 lakh crore in 2025-26.

CAGR growth

Finance Minister Desai said, the State has recorded a compound annual growth rate (CAGR) of 12.56 per cent in the last decade. The state’s contribution in India’s GDP in 2021-22 was recorded at 8.26 per cent, which Desai estimated to increase to 10 per cent in the coming year.

Desai further said that Gujarat remained top investment destination as it attracted foreign investment worth ₹18 lakh crore in past 8 years forming 57 per cent of the total foreign investment made in India.

Besides maintaining the desired fiscal responsibility, the ruling BJP government also tried to fulfil some of its promises made during the State assembly polls held in December 2022. This includes doubling of insurance coverage under Pradhan Mantri Jan Arogya-MA (PMJAY-MA) scheme to ₹10 lakh from ₹5 lakh. Also, the Finance Minister announced free two gas cylinders per year for Ujjwala scheme beneficiaries. The BJP had swept 156 seats in the 182-seat house.

The Chief Minister Bhupendra Patel commented, “Gujarat aims to spend ₹2 lakh crore over a period of next five years for green growth. This budget is rightly in that direction.”

Other announcements

Among other noticeable announcements, the Gujarat government will begin procurement of millets maize, jowar, ragi (nagli) under the public distribution system. Total ₹30 crore is allocated for the purpose. This comes in the backdrop of 2023 being celebrated as international year of millets. Also, a ‘Fin-Tech Hub’ will be established at GIFT City with support from Asian Development Bank.

Social Justice and Empowerment received allocations of ₹5,580 crore, tribal development was given ₹3,410 crore allocation, total provision of ₹43,651 crore for Education and human resources, health and family welfare received allocations of ₹15,182 crore, urban development was given ₹19,685 crore, energy and petrochemicals received ₹8,738 crore, roads and building was allocated ₹20,642 crore and agriculture and farmers welfare received allocations of ₹21,605 crore.

Allocation of over ₹14,000 crore was made for industries and mines, tourism and ports and transport sector.

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