"Gratitude is a
sickness suffered by dogs."
—Joseph Stalin (Georgian,
1879-1953)
Word for the day
Reconteuse (n)
A woman who is skilled in
relating stories and anecdotes interestingly.
(Source: Dictionary.com)
Malice towards none
Kurmi for Kurmi; Koeri for
Koeli; Yadav for Yadav; and Lodh for Lodh - it's like a hockey match in UP with
man to man marking strategy.
First random thought this morning
The presidential election in the USA no longer seems to be a
contest between the republicans and democrats. It has definitely transformed
into something else.
The leading republican contender is creating fears of anarchy in
many minds. The leading democrat contender is seen less as a politician and
more as a woman.
The deeply sexist and racist character of white American male is
out in the open for everyone to see and feel.
States of the Union
RBI recently released a report on the finances of the states of
the union. The report highlights many interesting developments. The most
significant been that in FY16 state finances budgeted for a turnaround in
fiscal performance during 2015-16 from the deterioration that set in during the
earlier two years.
The projected improvement in key fiscal indicators was led mostly
by austerity (cutbacks in revenue expenditure). The capital outlays on
consolidated level saw only a marginal decline.
The report highlights that the state finances have improved
materially post implementation of FRBM Act. The states are now more pragmatic
in handling the constraints faced in augmenting expenditure without
compromising on fiscal consolidation goals.
The report also highlights that contrary to the propaganda the
increase in states’ share of tax devolution from 32% to 42% of the divisible
pool on the recommendation by the fourteenth finance commission actually works
out to a decline in consolidated state revenues from central transfers (share
in central taxes plus grants in aid) by 0.3 per cent of GDP in
2015-16, due to discontinuation of many
centrally sponsored schemes (CSS) announced in the Union Budget, 2015-16.
The report also explores issues which are likely to have a bearing
on the quality of states’ expenditure in the medium term; reform of state-level
public enterprises, the goods and services tax and the Ujwal Discoms Assurance
Yojana (UDAY) scheme.
The report focuses on state finances to assess he quality of expenditure
which is key to sub-national level fiscal consolidation to reap efficiency and
welfare gains while smoothing the effects of fiscal adjustment.
The quality of expenditure is at centre-stage of the dynamics of
subnational level fiscal consolidation in India. Empirical evaluation indicates
that expenditure on public infrastructure, human capital, science and
technology can be growth and welfare enhancing by improving capital and labour
productivity.
The report prominently draws attentions to the rise in revenue and
non-development expenditure of the states and the consequent deterioration in
the quality of states’ spending.
It is widely stated that Indian states need to prioritise
expenditure on physical and social infrastructure and economise on nonessential
heads. From a medium term perspective, enduring improvements in the quality of
states’ finances hinges around the revival of state level public enterprises
(SLPEs), improving the viability of Discoms and rationalisation of centrally
sponsored schemes.
I shall discuss some key issues highlighted in the report next
week.
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