Chief Minister H.D. Kumaraswamy honoured his party’s poll promise by announcing waiver of crop loans of Rs. 34,000 crore in the coalition government’s maiden budget presented on Thursday.
To fund the waiver scheme, people would need to brace themselves to pay more for petrol, diesel, electricity, liquor, and motor vehicles.
Largely focusing on the needs of the constituencies in the Cauvery region where the JD(S) won the highest number of seats in the Assembly, the Chief Minister maintained that all proposals of the budget presented by Siddaramaiah on February 16, 2018, would be implemented, and he had only added new schemes and proposals.
The size of the budget is Rs. 9,307 crore more than the previous one presented by Mr. Siddaramaiah. The coalition government’s budget size was Rs. 2,18,488 crore against Mr. Siddaramaiah’s budget of Rs. 2,09,181 crore.
The budget capped crop loan waiver at Rs. 2 lakh. In the first stage, defaulted crop loans of farmers up to December 31, 2017, would be written off. Farmers who repaid the loan within a time frame would, as a pat on the back, be credited with the repaid loan amount or Rs. 25,000, whichever is less.
To garner resources to waive loans from cooperative and nationalised banks, the budget proposes to increase tax on petrol from the present 30% to 32% and diesel from 19% to 21%. Hence, petrol price will increase by Rs. 1.14/ltr and diesel by Rs. 1.12/ltr. Tax on liquor has been increased by 4% and consumption of electricity by 3%.
The Chief Minister defended this saying that fuel prices are lower in Karnataka when compared to neighbouring States of south India. He said he had managed to pull off loan waiver while staying within the parameters of the Karnataka Fiscal Responsibility Act.
Districts of Hassan, Mandya, Ramanagaram, Mysuru, Chickballpur, and Tumakuru have received a big bonanza in the budget. While there are not many new projects for Bengaluru, the budget earmarks Rs. 1,000 crore for the first phase of a mega project to build a network of elevated corridors in the city, totalling to 95 km linking opposite ends of the city.
To compete with Chinese toys/products, the budget proposes incentives to domestic manufactures, on the lines of Make in India. A new scheme — Kayaka — was announced to enhance skill development and entrepreneurship quality in SHGs.
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