The Finance Minister of Andhra Pradesh, Mr. Bugganna Rajendranath, presented the Budget for the state for the financial year 2021-22 on May 20, 2021.  Note that due to the impact of COVID-19, 2020-21 was not a standard year with respect to the performance of the economy and government finances.  In this note, 2021-22 budget estimates have been compared to the actuals for 2019-20 (in terms of compounded annual growth rate or CAGR).  Annexure to this note provides a comparison of the revised estimates for 2020-21 and budget estimates for 2021-22.

Budget Highlights

  • The Gross State Domestic Product (GSDP) of Andhra Pradesh for 2021-22 (at current prices) is projected to be Rs 10,61,781 crore.  This is an annual increase of 4% over the actual GSDP of 2019-20. The GSDP for 2021-22 is estimated to be 5.1% higher than the revised estimate of GSDP for 2020-21 (Rs 10,19,146 crore).  In 2020-21, the GSDP of Andhra Pradesh is estimated to grow by 4% over the previous year.  In comparison, the GDP of India at current prices is estimated to contract by 3.8% in 2020-21 and grow by 14.4% in 2021-22.
     
  • Total expenditure for 2021-22 is estimated to be Rs 2,29,779 crore, an annual increase of 15% over the actual expenditure in 2019-20.
     
  • Total receipts (excluding borrowings) for 2021-22 are estimated to be Rs 1,77,247 crore, an annual increase of 24% over 2019-20.  In 2020-21, total receipts (excluding borrowings) are estimated to fall short of the budget estimate by Rs 43,433 crore (a shortfall of 27%). 
     
  • Revenue deficit for 2021-22 is estimated to be Rs 5,000 crore, which is 0.47% of the GSDP.  In 2020-21, as per the revised estimate, revenue deficit is estimated at Rs 34,927 crore (3.46% of GSDP) as compared to a revenue deficit of Rs 18,434 crore (1.82% of GSDP) estimated at the budget stage.
     
  • Fiscal deficit for 2021-22 is targeted at Rs 37,030 crore (3.49% of GSDP).  In 2020-21, fiscal deficit is expected to be 5.38% of GSDP as per the revised estimate, higher than the budget estimate of 4.78% of GSDP.

Policy Highlights

  • Dairy Development: Under the GoAP-AMUL project, women farmers will be organised in 9,899 Mahila Dairy Sahakara Sanghalu.  These groups will be provided with infrastructural and operational support to ensure remunerative price and economic development.
     
  • Budgets for women, child, and minorities: The state government presented special statements on gender budget and child budget under the 2021-22 budget.  It has also introduced a minority action plan under the budget which will encapsulate budget provisions for minorities.

Andhra Pradesh’s Economy

  • GSDP:  In 2020-21, Andhra Pradesh’s GSDP (at constant prices) is estimated to contract by 2.6% over the previous year.  In 2019-20, GSDP is estimated to grow by 7.2%.
     
  • In 2019-20, per capita GSDP of Andhra Pradesh was Rs 1,29,516 (at constant prices).
     
  • Sectors:    In 2020-21, agriculture, manufacturing, and services sectors contributed to 33%, 26%, and 41% of the economy.  In 2020-21, manufacturing and services sectors registered negative growth.
  • Unemployment:  According to the Periodic Labour Force Survey 2018-19 (July 2018-June 2019), Andhra Pradesh has an unemployment rate of 5.3%, which is lower than the unemployment rate of 5.8% at the national level.

Figure 1: Growth in GSDP and sectors in Andhra Pradesh at constant prices (2011-12)

 image

Note: These numbers are as per constant prices (2011-12) which implies that the growth rate is adjusted for inflation.
Sources: MOSPI; Andhra Pradesh Budget Documents 2021-22.

Budget Estimates for 2021-22

  • Total expenditure in 2021-22 is targeted at Rs 2,29,779 crore.  This is an annual increase of 15% over the actual expenditure in 2019-20.  This expenditure is proposed to be met through receipts (other than borrowings) of Rs 1,77,247 crore and borrowings of Rs 50,525 crore.  Total receipts in 2021-22 (other than borrowings) are expected to register an annual increase of 24% over the actual receipts in 2019-20.
     
  • As per the revised estimates for 2020-21, total expenditure is estimated to be 17% lower than the budget estimates.  In 2020-21, receipts (other than borrowings) are estimated to be 27% lower than budgeted.
     
  • The state expects a revenue deficit of Rs 5,000 crore in 2021-22 (0.47% of GSDP).  In 2020-21, revenue deficit is estimated to be Rs 34,927 crore at the revised stage, as compared to the revenue deficit of Rs 18,434 crore estimated at the budget stage.  Fiscal deficit for 2021-22 is estimated to be Rs 37,030 crore (3.49% of GSDP).  In 2020-21, as per the revised estimates, fiscal deficit is estimated to increase to 5.38% of GSDP as compared to 4.78% of GSDP estimated at the budget stage.    

Table 1: Budget 2021-22 - Key figures (in Rs crore)

Items

2019-20 Actuals

2020-21 Budgeted

2020-21 Revised

% change from BE 2020-21 to RE 2020-21

2021-22 Budgeted

Annualised Change (2019-20 to 2021-22 BE)

Total Expenditure

 1,73,701 

 2,24,789 

 1,85,468 

-17%

 2,29,779 

15%

A. Receipts (except borrowings)

 1,15,389 

 1,62,558 

 1,19,126 

-27%

 1,77,247 

24%

B. Borrowings

 51,687 

 60,258 

 57,805 

-4%

 50,525 

-1%

Total Receipts (A+B)

 1,67,077 

 2,22,816 

 1,76,930 

-21%

 2,27,772 

17%

Revenue Deficit

 26,441 

 18,434 

 34,927 

89%

 5,000 

-57%

As % of GSDP

2.72%

1.82%

3.46%

 

0.47%

 

Fiscal Deficit

 39,684 

 48,296 

 54,369 

13%

 37,030 

-3%

As % of GSDP

4.08%

4.78%

5.38%

 

3.49%

 

Primary Deficit

 22,031 

 27,912 

 32,343 

16%

 14,290 

-19%

As % of GSDP

2.26%

2.76%

3.20%

 

1.35%

 

Note: BE is Budget Estimates; RE is Revised Estimates.

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.

Expenditure in 2021-22

Capital Outlay

Andhra Pradesh’s capital outlay for 2021-22 is estimated to be Rs 31,198 crore, which is an annual increase of 60% over 2019-20.  The revised estimate for capital outlay in 2020-21 is Rs 18,797 crore which is 37% lower than the budget estimate.  This includes a reduction of Rs 6,786 crore in the allocation towards irrigation and flood control, and a reduction of Rs 1,962 crore towards transport.  This accounts for 79% of the total reduction in capital outlay in 2020-21. 

  • Capital expenditure for 2021-22 is proposed to be Rs 47,583 crore, which is an annual increase of 15% over the actual capital expenditure in 2019-20.  Capital expenditure includes expenditure affecting the assets and liabilities of the state, such as: (i) capital outlay, i.e., expenditure which leads to the creation of assets (such as bridges and hospitals), and (ii) repayment and grant of loans by the state government.  
     
  • Revenue expenditure for 2021-22 is proposed to be Rs 1,82,197 crore, which is an annual increase of 15% over 2019-20.  This expenditure includes the payment of salaries, pensions, interest, and subsidies.  In 2020-21, as per the revised estimates, revenue expenditure is estimated to be 15% lower than the budget estimates.

Table 2: Expenditure budget 2021-22 (in Rs crore)

Items

2019-20 Actuals

2020-21 Budgeted

2020-21 Revised

% change from BE 2020-21 to RE 2020-21

2021-22 Budgeted

Annualised Change (2019-20 to 2021-22 BE)

Capital Expenditure

 36,226 

 44,397 

 32,478 

-27%

 47,583 

15%

of which Capital Outlay

 12,242 

 29,908 

 18,797 

-37%

 31,198 

60%

Revenue Expenditure

1,37,475 

 1,80,393 

 1,52,990 

-15%

 1,82,197 

15%

Total Expenditure

1,73,701 

 2,24,789 

 1,85,468 

-17%

 2,29,779 

15%

A. Debt Repayment

 18,625 

 13,935 

 11,973 

-14%

 15,503 

-9%

B. Interest Payments

 17,653 

 20,383 

 22,026 

8%

 22,740 

13%

Debt Servicing (A+B)

36,278

34,318

33,999

-0.9%

38,243

3%

Note: BE is Budget Estimates; RE is Revised Estimates.  

Sources: Andhra Pradesh Budget Documents 2021-22; PRS. 

Sectoral expenditure in 2021-22

The sectors listed below account for 67% of the total expenditure on sectors by the state in 2021-22.  A comparison of Andhra Pradesh’s expenditure on the key sectors with other states can be found in Annexure 1.  

Table 3: Sector-wise expenditure under Andhra Pradesh Budget 2021-22 (in Rs crore)

Sector

2019-20 Actuals

2020-21

BE

2020-21

RE

2021-22

BE

Annualised Change (2019-20 to 2021-22 BE)

Budget provisions 2021-22

Welfare of SC, ST, OBC, and Minorities

 21,764 

 41,430 

 23,414 

 27,870 

13%

  • Rs 17,000 crore has been allocated towards the YSR Pension Kanuka scheme.

Education, Sports, Arts, and Culture

 26,643 

 25,517 

 24,268 

 27,212 

1%

  • Rs 7,412 crore has been allocated towards teaching grants to Mandal Praja Parishads. 
  • Rs 3,500 crore has been allocated towards the Nadu-Nedu scheme to create infrastructure facilities for schools.
  • Rs 2,031 crore has been allocated towards Samagra Shiksha Abhiyan.

Rural Development

 8,327 

 13,544 

 14,252 

 14,943 

34%

  • Rs 4,263 crore has been allocated towards MGNREGS.
  • Rs 865 crore has been allocated towards providing interest-free loans to women under the Vaddileni Runalu scheme.

Health and Family Welfare

 7,538 

 11,673 

 9,570 

 14,088 

37%

  • Rs 3,202 crore has been allocated towards the National Health Mission.
  • Rs 1,559 crore has been allocated towards the YSR Arogyasri Health Care Trust.
  • Rs 500 crore has been allocated towards the COVID-19 vaccination.

Agriculture and allied activities

 6,904 

 13,563 

 10,525 

 13,299 

39%

  • Rs 3,845 crore has been allocated towards the YSR Rythu Bharosa scheme.
  • Rs 1,803 crore has been allocated towards the YSR-PM Fasal Bima Yojana.

Irrigation and Flood Control

 4,931 

 11,358 

 4,518 

 12,691 

60%

  • Rs 4,802 crore has been allocated towards the Polavaram irrigation project.
  • Rs 1,736 crore and Rs 1,043 crore has been allocated towards irrigation projects in Ongole and Anantapur, respectively.

Social Welfare and Nutrition

 6,382 

 10,795 

 7,202 

 11,384 

34%

  • Rs 1,556 crore has been allocated towards the YSR Sampoorna Poshana scheme.
  • Rs 1,396 crore has been allocated towards the Integrated Child Development Service.

Urban Development

 4,569 

 7,014 

 4,637 

 8,330 

35%

  • Rs 1,000 crore has been allocated towards the Smart Cities scheme.
  • Rs 531 crore has been allocated towards Andhra Pradesh Capital Region Development Authority.
  • Rs 500 crore has been allocated towards creating essential infrastructure for the new capital city.

Transport

 2,104 

 6,250 

 4,968 

 7,458 

88%

  • Rs 3,007 crore has been allocated to the Road Transport Department.
  • Rs 2,271 crore has been allocated towards capital outlay on roads and bridges.

Police

 5,658 

 5,299 

 5,932 

 6,398 

6%

  • Rs 3,561 crore has been allocated towards district police forces.
  • Rs 236 crore has been allocated towards the intelligence branch.

% of total expenditure on all sectors

63%

70%

64%

67%

 

 

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.
 

Receipts in 2021-22

  • Total revenue receipts for 2021-22 are estimated to be Rs 1,77,196 crore, an annual increase of 26% over 2019-20.  Of this, Rs 92,315 crore (52%) will be raised by the state through its own resources, and Rs 84,881 crore (48%) will come from the centre.  Resources from the centre will be in the form of the state’s share in central taxes (15% of revenue receipts) and grants (33% of revenue receipts).
     
  • Devolution:  In 2021-22, receipts from the state’s share in central taxes (devolution) are estimated to register an annual decrease of 2% over actual devolution in 2019-20.  As per the revised estimates, devolution to Andhra Pradesh in 2020-21 is estimated to be 24% lower than the budget estimate.  This may be due to a 30% cut in the union budget for devolution to states, from Rs 7,84,181 crore at the budgeted stage to Rs 5,49,959 crore at the revised stage.
  • State’s own tax revenue:  Total own tax revenue of the state in 2021-22 is estimated to be Rs 85,265 crore, an annual increase of 22% over 2019-20.  In 2020-21, as per the revised estimates, state’s own tax revenue is estimated to be 19% lower than the budget estimates.  In 2021-22, the state’s own tax to GSDP ratio is targeted at 8% which is notably higher than the revised estimate of 5.7% in 2020-21.  This implies that growth in the state’s own tax is estimated to be higher than the economic growth.

Table 4: Break up of state government receipts (in Rs crore)

Items

2019-20 Actuals

2020-21

BE

2020-21

RE

% change from BE 2020-21 to RE 2020-21

2021-22 

BE

Annualised Change (2019-20 to 2021-22 BE)

State's Own Tax

 57,601 

 70,653 

 57,359 

-19%

 85,265 

22%

State's Own Non-Tax

 3,315 

 5,866 

 3,310 

-44%

 7,050 

46%

Share in Central Taxes

 28,242 

 32,264 

 24,461 

-24%

 26,951 

-2%

Grants-in-aid from Centre

 21,876 

 53,175 

 32,934 

-38%

 57,931 

63%

Total Revenue Receipts

1,11,034

1,61,958

1,18,063

-27%

 1,77,196 

26%

Borrowings

 51,687 

 60,258 

 57,805 

-4%

 50,525 

-1%

Other receipts

 4,355 

 600 

 1,062 

77%

 50 

-89%

Total Capital Receipts

 56,043 

 60,858 

 58,867 

-3%

 50,576 

-5%

Total Receipts

 1,67,077 

 2,22,816 

 1,76,930 

-21%

 2,27,772 

17%

GST Compensation

The GST (Compensation to States) Act, 2017 guarantees states compensation for five years (till 2022) for any revenue loss arising due to GST implementation.    The Act guarantees states a 14% annual growth in their GST revenue, failing which compensation grants are provided to states to meet the shortfall.  These grants are funded through the GST compensation cess levied by the centre.  As the cess collection is not sufficient to meet the compensation requirement of states in 2020-21, a part of their requirement will be met through loans from the centre (which will be repaid using future cess collection).

The state has not estimated any GST compensation grants for either 2020-21 or 2021-22 in the budget.  As per the revised estimates, the state is estimated to receive a loan amounting to Rs 2,136 crore in 2020-21 in lieu of GST compensation.

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.

  • In 2021-22, State GST (SGST) is estimated to be Rs 31,000 crore, the largest source of the state’s own tax revenue (36%).  It is estimated to increase at an annual rate of 24% over the actual SGST revenue in 2019-20.  In 2020-21, SGST is estimated to be 26% less than the budget estimate. 
     
  • In 2021-22, the state is expected to generate Rs 24,500 crore through the collection of Sales Tax/VAT, an annual increase of 7% over 2019-20.  
     
  • In 2020-21, the State Excise collection is estimated to be 46% higher than the budget estimate.  
     
  • In 2021-22, revenue from taxes and duties on electricity is estimated to be Rs 1,008 crore, significantly higher than Rs 13 crore in 2020-21 (revised estimate) and Rs 11 crore in 2019-20.

Table 5: Some of the major state’s own tax revenue sources (in Rs crore)

Head

2019-20 Actuals

2020-21

BE

2020-21

RE

% change from BE 2020-21 to RE 2020-21

2021-22 

BE

Annualised Change (2019-20 to 2021-22 BE)

% of Revenue Receipts in 2021-22

State GST

 20,227 

 25,604 

 18,871 

-26%

 31,000 

24%

17%

Sales Tax/ VAT

 21,410 

 25,743 

 17,800 

-31%

 24,500 

7%

14%

State Excise

 6,915 

 7,931 

 11,575 

46%

 15,000 

47%

8%

Stamps Duty and Registration Fees

 5,318 

 6,337 

 5,601 

-12%

 8,000 

23%

5%

Taxes on Vehicles

 3,279 

 4,463 

 2,920 

-35%

 5,000 

23%

3%

Taxes and Duties on Electricity

 11 

 13 

 13 

-5%

 1,008 

846%

1%

Land Revenue

 21 

 32 

 143 

348%

 172 

184%

0%

GST Compensation Grants

 1,841 

 -   

 -   

-

 -   

-

-

GST Compensation Loans

-

-

 2,136 

-

 -   

-

-

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.

Deficits, Debt, and FRBM Targets for 2021-22

The Andhra Pradesh Fiscal Responsibility and Budget Management (FRBM) Act, 2005 provides annual targets to progressively reduce the outstanding liabilities, revenue deficit, and fiscal deficit of the state government.  

Fiscal Roadmap for 2021-26

The 15th Finance Commission recommended the following fiscal deficit targets for states for the 2021-26 period (as a % of GSDP): (i) 4% for 2021-22, (ii) 3.5% for 2022-23, and (iii) 3% for 2023-26.    The Commission estimates that this path will lead to a decrease in total liabilities of Andhra Pradesh from 35% of GSDP in 2020-21 to 32.1% of GSDP in 2025-26.

If a state is unable to fully utilise the sanctioned borrowing limit as specified above in any of the first four years (2021-25), it can avail the unutilised borrowing amount in subsequent years (within the 2021-26 period).  Additional borrowing worth 0.5% of GSDP will be allowed each year for the first four years (2021-25) upon undertaking certain power sector reforms including: (i) reduction in operational losses, (ii) reduction in revenue gap, (iii) reduction in payment of cash subsidy by adopting direct benefit transfer, and (iv) reduction in tariff subsidy as a percentage of revenue.  

Revenue deficit:  It is the excess of revenue expenditure over revenue receipts.  A revenue deficit implies that the government needs to borrow to finance its expenses which do not increase its assets or reduces its liabilities.  A revenue deficit indicates that the revenue receipts of the state are not sufficient to meet the revenue expenditure requirements.  The budget estimates a revenue deficit of Rs 5,000 crore (or 0.47% of the GSDP) in 2021-22.  In 2020-21, as per the revised estimates, revenue deficit is estimated at Rs 34,927 crore (3.46% of GSDP) as compared to a revenue deficit of Rs 18,434 crore (1.82% of GSDP) estimated at the budget stage.  The 15th Finance Commission has recommended post-devolution revenue deficit grants of Rs 30,497 crore for Andhra Pradesh for the period between 2021-22 and 2023-24.

Fiscal deficit:  It is the excess of total expenditure over total receipts.  This gap is filled by borrowings which leads to an increase in total liabilities.  In 2021-22, the fiscal deficit is estimated to be Rs 37,030 crore (3.49% of GSDP).  As per the revised estimates, in 2020-21, the fiscal deficit of the state is estimated to be 5.38% of GSDP, which is higher than the budget estimate of 4.78%.

Enhanced borrowing limit in 2020-21: Given the situation due to COVID-19, the central government permitted states to increase their fiscal deficit up to 5% of GSDP in 2020-21.  Andhra Pradesh’s fiscal deficit for 2020-21 is expected to be 5.38%, which is higher than the increased limit.  All states were allowed to increase their fiscal deficit up to 4% of GSDP.  The remaining 1% of GSDP is conditional on the implementation of reforms by states in the following areas (0.25% of GSDP for each reform): (i) one nation one ration card, (ii) ease of doing business, (iii) urban local body/ utility, and (iv) power distribution.  As of February 17, 2021, the state has completed the first three reforms whereas it has partially completed the reforms in the power distribution.  Andhra Pradesh is eligible to borrow Rs 9,090 crore for implementing these reforms.

Outstanding liabilities:  Outstanding liabilities refers to the accumulation of total borrowings at the end of a financial year.  In 2021-22, the outstanding liabilities are estimated to be 36.5% of the GSDP, higher than the revised estimate for 2020-21 (35.2% of GSDP).  The outstanding liabilities are estimated to increase from 31% in 2019-20 to 36.5% in 2021-22.

Table 6: Budget targets for deficits for Andhra Pradesh (% of GSDP)

Year

Revenue Deficit

Fiscal Deficit

Outstanding liabilities

2019-20 (Actuals)

2.7%

4.1%

31.0%

2020-21 (Revised)

3.5%

5.4%

35.2%

2021-22 (Budget)

0.5%

3.5%

36.5%

Note: Outstanding liabilities includes outstanding debt under Internal Debt, Loans and Advances from Centre, Small Savings, Provident Fund, and Deposit and Reserve Funds.

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.

Figure 2: Revenue and Fiscal Deficit (as % of GSDP) 

image

Note: RE is Revised Estimates; BE is Budget estimates.

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.  

Figure 3: Outstanding liabilities targets (as % of GSDP)

image

Note: RE is Revised Estimates; BE is budget estimates.

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.  

 

Annexure 1:  Comparison of states’ expenditure on key sectors

The graphs below compare Andhra Pradesh’s expenditure on six key sectors as a proportion of its total expenditure on all sectors.  The average for a sector indicates the average expenditure in that sector by 30 states (including Andhra Pradesh) as per their budget estimates of 2020-21.[1]

  • Education:  Andhra Pradesh has allocated 12.8% of its total expenditure for education in 2021-22.  This is lower than the average allocation (15.8%) for education by all states (2020-21 BE).
  • Health:  Andhra Pradesh has allocated 6.6% of its total expenditure on health, which is higher than the average allocation for health by states (5.5%).
     
  • Agriculture:  Andhra Pradesh has allocated 6.2% of its total expenditure towards agriculture and allied activities.  This is similar to the average allocation for agriculture by states (6.3%).
     
  • Rural development:  Andhra Pradesh has allocated 7% of its expenditure on rural development.  This is higher than the average allocation for rural development by states (6.1%).
     
  • Police:  Andhra Pradesh has allocated 3% of its total expenditure on police, which is lower than the average expenditure on police by states (4.3%).
     
  • Roads and bridges:  Andhra Pradesh has allocated 1.7% of its total expenditure on roads and bridges, which is significantly lower than the average allocation by states (4.3%).
image image image
image image image

Note: 2019-20, 2020-21 (BE), 2020-21 (RE), and 2021-22 (BE) figures are for Andhra Pradesh.

Sources: Andhra Pradesh Budget Documents 2021-22; various state budgets; PRS.

Annexure 2:  Recommendations of the 15th Finance Commission for 2021-26

The 15th Finance Commission’s (FC) report for the 2021-26 period was released on February 1, 2021.  For the 2021-26 period, the Commission has recommended the share of states in the divisible pool of central taxes to be 41%, same as that for 2020-21 (also recommended by the 15th FC in its report for 2020-21).  This is 1% point lower than the 42% share recommended by the 14th FC (for the 2015-20 period) to separately provide funds for the newly formed union territories of Jammu and Kashmir, and Ladakh.  The 15th FC proposed revised criteria for determining the share of individual states (different from 14th FC).  Based on the 15th FC’s recommendations for the period 2021-26, Andhra Pradesh will have a 1.66% share in the divisible pool of central taxes.  This implies that out of every Rs 100 of revenue in the divisible pool during the 2021-26 period, Andhra Pradesh will receive Rs 1.66.  This is 8.2% lower than Rs 1.81 share recommended by the 14th FC for the 2015-20 period.

Table 7:  Share of states in the divisible pool of central taxes under the 14th and 15th FC periods 

State

14th FC

15th FC

15th FC

% change

2015-20

2020-21

2021-26

2015-20
 to 2021-26

2020-21
 to 2021-26

Andhra Pradesh

1.81

1.69

1.66

-8.2%

-1.6%

Arunachal Pradesh

0.58

0.72

0.72

25.2%

-0.2%

Assam

1.39

1.28

1.28

-7.8%

-0.1%

Bihar

4.06

4.13

4.12

1.6%

0.0%

Chhattisgarh

1.29

1.40

1.40

8.0%

-0.3%

Goa

0.16

0.16

0.16

-0.3%

0.0%

Gujarat

1.30

1.39

1.43

10.1%

2.4%

Haryana

0.46

0.44

0.45

-1.6%

1.0%

Himachal Pradesh

0.30

0.33

0.34

13.6%

3.9%

Jammu & Kashmir

0.78

-

-

-

-

Jharkhand

1.32

1.36

1.36

2.8%

-0.2%

Karnataka

1.98

1.50

1.50

-24.5%

0.0%

Kerala

1.05

0.80

0.79

-24.8%

-0.9%

Madhya Pradesh

3.17

3.23

3.22

1.5%

-0.5%

Maharashtra

2.32

2.52

2.59

11.7%

3.0%

Manipur

0.26

0.29

0.29

13.3%

-0.3%

Meghalaya

0.27

0.31

0.31

16.6%

0.3%

Mizoram

0.19

0.21

0.21

6.1%

-1.2%

Nagaland

0.21

0.24

0.23

11.5%

-0.7%

Odisha

1.95

1.90

1.86

-4.8%

-2.2%

Punjab

0.66

0.73

0.74

11.9%

1.1%

Rajasthan

2.31

2.45

2.47

7.1%

0.8%

Sikkim

0.15

0.16

0.16

3.2%

0.0%

Tamil Nadu

1.69

1.72

1.67

-1.0%

-2.6%

Telangana

1.02

0.88

0.86

-15.8%

-1.5%

Tripura

0.27

0.29

0.29

7.7%

-0.1%

Uttar Pradesh

7.54

7.35

7.36

-2.5%

0.0%

Uttarakhand

0.44

0.45

0.46

3.7%

1.3%

West Bengal

3.08

3.08

3.08

0.3%

0.1%

Total

42.00

41.00

41.00

   

Note: Although the 15th Finance Commission recommended the same criteria for 2020-21 and 2021-26 periods, the reference period for computation on some underlying indicators are different. This is why the share in the divisible pool in 2020-21 and 2021-26 differ for states. State’s share has been rounded off to two decimal places.
Sources: Reports of 14th and 15th FCs; Union Budget Documents 2021-22; PRS.

The 15th FC recommended grants worth Rs 10.3 lakh crore for states over five years (2021-26).  A portion of these grants will be conditional.  17 states will receive revenue deficit grants during this period.    Sector-specific grants include grants for sectors such as health, agriculture, and education.  Grants to local governments include: (i) Rs 1.2 lakh crore for urban local bodies, (ii) Rs 2.4 lakh crore for rural local bodies, and (iii) health grants worth Rs 70,000 crore through local bodies for healthcare infrastructure.  

Table 8: Grants recommended for 2021-26 (Rs crore)

Grants

Total

Andhra Pradesh

Revenue deficit grants

 2,94,514

30,497

Local governments grants

 4,36,361

18,063*

Sector-specific grants

 1,29,987

5,994#

Disaster management grants

 1,22,601

6,183

State-specific grants

49,599

2,300

Total

10,33,062

63,037

Note:  This does not include competition-based grants including *grants for incubation of new cities (part of local bodies grants), and #grants for school education, and aspirational districts and blocks.
Source: Report of 15th FC; PRS.

State-specific grants recommended for Andhra Pradesh include: (i) Rs 1,400 crore for the development of core infrastructure in Vishakhapatnam, and (ii) Rs 900 crore for the provision of safe and potable water.

Table 9: Taxes devolved to states as per Union Budget 2021-22

State

2019-20

2020-21
 Revised

2021-22
 Budget

Andhra Pradesh

29,421

22,611

26,935

Arunachal Pradesh

9,363

9,681

11,694

Assam

22,627

17,220

20,819

Bihar

66,049

55,334

66,942

Chhattisgarh

21,049

18,799

22,676

Goa

2,583

2,123

2,569

Gujarat

21,077

18,689

23,148

Haryana

7,408

5,951

7,275

Himachal Pradesh

4,873

4,394

5,524

Jammu & Kashmir

12,623

-38

-

Jharkhand

21,452

18,221

22,010

Karnataka

32,209

20,053

24,273

Kerala

17,084

10,686

12,812

Madhya Pradesh

51,584

43,373

52,247

Maharashtra

37,732

33,743

42,044

Manipur

4,216

3,949

4,765

Meghalaya

4,387

4,207

5,105

Mizoram

3,144

2,783

3,328

Nagaland

3,403

3,151

3,787

Odisha

31,724

25,460

30,137

Punjab

10,777

9,834

12,027

Rajasthan

37,554

32,885

40,107

Sikkim

2,508

2,134

2,582

Tamil Nadu

27,493

23,039

27,148

Telangana

16,655

11,732

13,990

Tripura

4,387

3,899

4,712

Uttar Pradesh

1,22,729

98,618

1,19,395

Uttarakhand

7,189

6,072

7,441

West Bengal

50,051

41,353

50,070

Total

6,83,353

5,49,959

6,65,563

Note: Actuals for 2019-20 and Revised Estimates for 2020-21 have been reported in the Union Budget after adjusting for excess or less devolution in previous years.  
Sources: Union Budget Documents 2021-22; PRS.

Annexure 3:  Comparison of 2020-21 Revised and 2021-22 Budget Estimates

The following tables compare the budget estimates for 2021-22 with the revised estimates for 2020-21.

Table 10: Key Components of State's Receipts and Expenditure

Particular

2020-21 RE

2021-22 BE

% change from 2020-21 RE to 2021-22 BE

Receipts (1+2)

1,76,930

2,27,772

29%

Receipts except Borrowings

1,19,126

1,77,247

49%

1. Revenue Receipts (a+b+c+d)

1,18,063

1,77,196

50%

a. Own Tax Revenue

57,359

85,265

49%

b. Own Non-Tax Revenue

3,310

7,050

113%

c. Share in central taxes

24,461

26,951

10%

d. Grants-in-aid from the Centre

32,934

57,931

76%

Of which GST compensation

0

0

-

2. Capital Receipts

58,867

50,576

-14%

a. Borrowings

57,805

50,525

-13%

Of which GST compensation loan

2,136

-

-

Expenditure (3+4)

1,85,468

2,29,779

24%

3. Revenue Expenditure

1,52,990

1,82,197

19%

4. Capital Expenditure

32,478

47,583

47%

i. Capital Outlay

18,797

31,198

66%

ii. Debt Repayment

11,973

15,503

29%

Revenue Deficit

34,927

5,000

-86%

Fiscal Deficit

54,369

37,030

-32%

Revenue Deficit (as % of GSDP)

3.46%

0.47%

-

Fiscal Deficit (as % of GSDP)

5.38%

3.49%

-

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.

Table 11: Key Components of State's Own Tax Revenue

Tax

2020-21 RE

2021-22 BE

% change from 2020-21 RE to 2021-22 BE

State GST

18,871

31,000

64%

Sales Tax/ VAT

17,800

24,500

38%

State Excise Duty

11,575

15,000

30%

Stamps Duty and Registration Fees

5,601

8,000

43%

Taxes on Vehicles

2,920

5,000

71%

Taxes and Duties on Electricity

13

1,008

7964%

Land Revenue

143

172

20%

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.

Table 12: Allocation towards Key Sector

Sector

2020-21 RE

2021-22 BE

% change from 2020-21 RE to 2021-22 BE

Welfare of SC, ST, OBC, and Minorities

 23,414 

 27,870 

19%

Education, Sports, Arts, and Culture

 24,268 

 27,212 

12%

Rural Development

 14,252 

 14,943 

5%

Health and Family Welfare

 9,570 

 14,088 

47%

Agriculture and allied activities

 10,525 

 13,299 

26%

Irrigation and Flood Control

 4,518 

 12,691 

181%

Social Welfare and Nutrition

 7,202 

 11,384 

58%

Urban Development

 4,637 

 8,330 

80%

Transport

 4,968 

 7,458 

50%

Police

 5,932 

 6,398 

8%

Sources: Andhra Pradesh Budget Documents 2021-22; PRS.

[1] The 30 states include the Union Territory of Delhi and Union Territory of Jammu and Kashmir.

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