MP Budget Falls Short of Expectations

An Analysis on MP State Budget 2013-14

Madhya Pradesh Budget, 2013 is managed to both surprise and disappoint. 2012-13 was one of the

rare years, when the state GDP crossing Rs. 409877 crores, clocking a growth rate of 14%. The

stupendous growth has been attributed to the bumper agricultural production and improved

performance of the industrial and service sectors. It is a matter of pride for MP, which was

previously categorized as a BIMARU state, to register a healthy economic performance.

Nevertheless, Madhya Pradesh continues to fare badly on most of the human development

indicators. The infant mortality rate (62) and maternal mortality rate (47) in the state are higher

than the national average. Similarly, in tribal districts like Alirajpur only 37.22 % persons are

literate as per Census 2011. Shockingly, Census 2011 also reveals that the use of household toilets

in rural MP stands at 13.5% as against the national average of

44.85%. In addition, as per the annual health survey of 2010-11,

60% of the children in MP are malnourished as compared to the

national average of 42%. Old-age pension in MP stands at the

lowest. Neighboring state Rajasthan provides Rs 500 per month

compared to MP which provides 275 per month to old-age

pensioners. The disability pension in Rajasthan is Rs. 1000 compared to 200 in M.P.

After recording an impressive growth in GDP, MP has presented a surplus budget Rs 6420.51 crores

in 2013-14. The state machinery has failed to visualize areas for investment in the social sector or

other productive sectors. It appears that the state political leadership is unable to muster courage

to present a deficit budget and maximize the potential use of the untapped economic resources and

enhance social sector investment. In terms of absolute figures, there is a substantial increase in

funds earmarked for sectors like education (from Rs. 11890.32 crores in 2012-13 to Rs 13510.38

crores in 2013-14), and health from (Rs. 3189.23 crores in 2012-13 to 3664.59 crores in 2013-14.

The expenditure on health was 0.95% of the state GDP in 2012-13 which was slashed down to 0.89

in 2013-14. Similarly last year, 3.54% of state GDP was spent on general education and in the

current budget it is pegged at 3.30% of state GDP. It is desirable to spend at least 6% of the state

GDP to attain the goals of universal elementary education.

The trend clearly indicates that no political will has been demonstrated to proportionately increase

investments where the developmental challenges are of higher order. Investing surplus resources

of the state in social sectors will bring long-term dividends to the previously-planned and now-

enhanced investment in the industrial sector. MP has a huge army of uneducated and unskilled

human resources, which is unemployable in the growing industrial and service sectors. The coming

years will see more in-migration of the skilled workforce from other states and out-migration of the

local unskilled labour. Economic growth without equitable distributive justice will be promoting

more disparities and unrest. MP will never be able to boast of a developed state status unless

people in extreme poverty are supported and the disabled, old and widows in poor families are

socially secured. It is shame for a resource-rich state like MP to give pension of Rs.275 to an old

person and Rs 200 to a disabled person.

Similarly, the primary and secondary government schools in MP are in a dire need of trained

teachers. A total of 16595 Anganwadi centers are required to saturate the state up to village level.

The state with 20.3% tribal population has cut down its Tribal Sub Plan (TSP) from 2.11 % of GDP

in 2012-13 to 1.91 % in 2013-14. Similarly, the Scheduled Caste sub plan has been reduced from

1.47 % of GDP in 2012-13 to 1.38 % in 2013-14.

Over the past few years, the state Government has launched several schemes like Ladli Laxmi

Yojana, Mukhya Mantri Kanyadan and Nikah Yojana or Samuhik Vivah. The allocations in the

budget for these schemes are to the tune of Rs 950 Crore. Some of these positive steps of gender

empowerment demonstrate strong political will for positive discrimination for women. It is also a

demonstration that the state does not completely depend on centrally-sponsored schemes for the

local needs. Many of these steps were taken by the State Government when the economic condition

of the state was not so rosy. In 2013, however, no such innovative scheme has been announced by

the government even though it is on a sound footing of resources and political stability.

The question is: is the time not ripe for policymakers to break free from the dependency on central,

especially when he state economy has presented an opportunity to think out of the box and find

local solutions to local problems? A golden opportunity has been missed this year especially when

citizens of M.P. are gearing to choose a more promising and dynamic government in the state

assembly elections due at the end of the year.

-By Dr. Yogesh Kumar

Dr. Yogesh Kumar, Executive Director of Samarthan, an NGO working in MP and Chhattisgarh