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The Finance Minister, Ms. Nirmala Sitharaman, presented the Union Budget for the financial year 2019-20 in Parliament on July 5, 2019.  In the 2019-20 budget, the government presented the estimates of its expenditure and receipts for the year 2019-20.  The budget also gave an account of how much money the government raised or spent in 2017-18.  In addition, the budget also presented the revised estimates made by the government for the year 2018-19 in comparison to the estimates it had given to Parliament in the previous year’s budget.

What are revised estimates?

Some of the estimates made by the government might change during the course of the year.  For instance, once the year gets underway, some ministries may need more funds than what was actually allocated to them in the budget, or the receipts expected from certain sources might change.  Such deviations from the budget estimates get reflected in the figures released by the government at later stages as part of the subsequent budgets.  Once the year ends, the actual numbers are audited by the Comptroller and Auditor General of India (CAG), post which they are presented to Parliament with the upcoming budget, i.e. two years after the estimates are made.

For instance, estimates for the year 2018-19 were presented as part of the 2018-19 budget in February 2018.  In the 2019-20 interim budget presented in February 2019 (10 months after the financial year 2018-19 got underway), the government revised these estimates based on the actual receipts and expenditure accounted so far during the year and incorporated estimates for the remaining two months.

The actual receipts and expenditure accounts of the central government are maintained by the Controller General of Accounts (CGA), Ministry of Finance on a monthly basis.  In addition to the monthly accounts, the CGA also publishes the provisional unaudited figures for the financial year by the end of the month of May.  Once these provisional figures are audited by the CAG, they are presented as actuals in next year’s budget.  The CGA reported the figures for 2018-19 on May 31, 2019.[1]  The Economic Survey 2018-19 presented on July 4, 2019 uses these figures.[2] 

The budget presented on July 5 replicates the revised estimates reported as part of the interim budget (February 1, 2019).  Thus, it did not take into account the updated figures for the year 2018-19 from the CGA.

Table 1 gives a comparison of the 2018-19 revised estimates presented by the central government in the budget with the provisional unaudited figures maintained by the CGA for the year 2018-19.[3]

Table 1:  Budget at a Glance: Comparison of 2018-19 revised estimates with CGA figures (unaudited) (Rs crore)

 

Actuals
2017-18

Budgeted
2018-19

Revised
2018-19

Provisional
2018-19

Difference
(RE 2018-19 to Provisional 2018-19)

Revenue Expenditure

18,78,833

 21,41,772

 21,40,612

20,08,463

-1,32,149

Capital Expenditure

2,63,140

 3,00,441

 3,16,623

3,02,959

-13,664

Total Expenditure

21,41,973

 24,42,213

 24,57,235

23,11,422

 -1,45,813

Revenue Receipts

14,35,233

 17,25,738

 17,29,682

15,63,170

-1,66,512

Capital Receipts

 1,15,678

 92,199

 93,155

1,02,885

9,730

of which:

 

 

 

 

 

Recoveries of Loans

 15,633

 12,199

 13,155

17,840

4,685

Other receipts (including disinvestments)

 1,00,045

 80,000

 80,000

85,045

5,045

Total Receipts (without borrowings)

15,50,911

 18,17,937

 18,22,837

16,66,055

-1,56,782

Revenue Deficit

 4,43,600

 4,16,034

 4,10,930

4,45,293

34,363

% of GDP

2.6

2.2

2.2

2.4

 

Fiscal Deficit

 5,91,062

 6,24,276

 6,34,398

6,45,367

10,969

% of GDP

3.5

3.3

3.4

3.4

 

Primary Deficit

 62,110

 48,481

 46,828

62,692

15,864

% of GDP

0.4

0.3

0.2

0.3

 

Sources:  Budget at a Glance, Union Budget 2019-20; Controller General of Accounts, Ministry of Finance; PRS.

The 2018-19 provisional figures for revenue receipts is Rs 15,63,170 crore, which is Rs 1,66,512 crore less than the revised estimates.  This is largely due to Rs 1,67,455 crore shortfall in centre’s net tax revenue between the revised estimates and the provisional estimates (Table 2).

Major taxes which see a shortfall between the gross tax revenue presented in the revised estimates vis-à-vis the provisional figures are income tax (Rs 67,346 crore) and GST (Rs 59,930 crore).  Non-tax revenue and disinvestment receipts as per the provisional figures are higher than the revised estimates.

Table 2:  Break up of central government receipts: Comparison of 2018-19 RE with CGA figures (unaudited) (Rs crore)

 

Actuals
2017-18

Budgeted
2018-19

Revised
2018-19

Provisional
2018-19

Difference
(RE 2018-19 to Provisional 2018-19)

Gross Tax Revenue

19,19,009

22,71,242

22,48,175

20,80,203

-1,67,972

of which:

 

 

 

 

 

Corporation Tax

5,71,202

6,21,000

6,71,000

6,63,572

-7,428

Taxes on Income

4,30,772

5,29,000

5,29,000

4,61,654

-67,346

Goods and Services Tax

4,42,562

7,43,900

6,43,900

5,83,970

-59,930

Customs

1,29,030

1,12,500

1,30,038

1,17,930

-12,108

Union Excise Duties

2,59,431

2,59,600

2,59,612

2,30,998

-28,614

A. Centre's Net Tax Revenue

12,42,488

14,80,649

14,84,406

13,16,951

-1,67,455

B. Non Tax Revenue

1,92,745

2,45,089

2,45,276

2,46,219

943

of which:

 

 

 

 

 

Interest Receipts

13,574

15,162

12,047

12,815

768

Dividend and Profits

91,361

1,07,312

1,19,264

1,13,424

-5,840

Other Non-Tax Revenue

87,810

1,22,615

1,13,965

1,19,980

6,015

C. Capital Receipts (without borrowings)

1,15,678

92,199

93,155

1,02,885

9,730

of which:

 

 

 

 

 

Disinvestment

1,00,045

80,000

80,000

85,045

5,045

Receipts (without borrowings) (A+B+C)

15,50,911

18,17,937

18,22,837

16,66,055

-1,56,782

Borrowings

5,91,062

6,24,276

6,34,398

6,45,367

10,969

Total Receipts (including borrowings)

21,41,973

24,42,213

24,57,235

23,11,422

-1,45,813

Note:  Centre’s net tax revenue is gross tax revenue less share of states in central taxes.  Figures for GST include receipts from the GST compensation cess.  Note that GST was levied for a nine-month period during the year 2017-18, starting July 2017.

Sources:  Receipts Budget, Union Budget 2019-20; Controller General of Accounts, Ministry of Finance; PRS.

While the provisional figures show a considerable decrease in receipts (Rs 1,56,782 crore) as compared to the revised estimates, fiscal deficit has not shown a comparable increase.  Fiscal deficit is estimated to be Rs 10,969 crore higher than the revised estimates as per the provisional accounts.

On the expenditure side, the total expenditure as per the provisional figures show a decrease of Rs 1,45,813 crore as compared to the revised estimates.  Certain Ministries and expenditure items have seen a decrease in expenditure as compared to the revised estimates made by the government.  As per the provisional accounts, the expenditure of the Ministry of Agriculture and Farmers’ Welfare and the Ministry of Consumer Affairs, Food and Public Distribution are Rs 22,133 crore and Rs 70,712 crore lower than the revised estimates, respectively.  The decrease in the Ministries’ expenditure as a percentage of the revised estimates are 29% and 39%, respectively.  The food subsidy according to CGA was Rs 1,01,904 crore, which was Rs 69,394 crore lower than the revised estimates for the year 2018-19 given in the budget documents.

 

[1] “Accounts of the Union Government of India (Provisional/Unaudited) for the Financial Year 2018-19”, Press Information Bureau, Ministry of Finance, May 31, 2019.

[2] Fiscal Developments, Economic Survey 2018-19, https://www.indiabudget.gov.in/economicsurvey/doc/vol2chapter/echap02_vol2.pdf.

[3] Controller General of Accounts, Ministry of Finance, March 2018-19, http://www.cga.nic.in/MonthlyReport/Published/3/2018-2019.aspx.

As of April 22, 2020, Sikkim does not have any confirmed cases of COVID-19.  As of April 21, 2020, 87 samples have been sent for testing from Sikkim.  Of these, 80 have tested negative for COVID-19, and the results of seven samples are awaited.  The state has announced several policy decisions to prevent the spread of the virus and provide relief for those affected by it.  In this blog post, we summarise some of the key measures taken by the Sikkim state government in this regard as of April 22, 2020.  

Response before national lockdown

On March 16, the state government responded to the growing number of suspected cases in India by notifying certain directions to be applicable till April 15, 2020.  These included: (i) banning the entry of all domestic and foreign tourists in to the state, (ii) closing all educational institutes and anganwadis, (iii) prohibiting the use of recreational facilities such as, casinos, gym, and cinemas, (iii) closing three out of five check posts (border opening) for all visitors in to the state and opening the other two only for medical and police teams, and (iv) banning private industries from getting migrant workers from outside the state and avoiding large concentration of workers at one place.

On March 19, assembly of more than five people was prohibited in the state until April 15, 2020.  The government ordered the suspension of all non-essential work on March 19.  The supply of all essential commodities such as food grains, vegetables, sanitisers and masks was allowed.  Further, the formation of a sub-divisional task force to detect suspected cases was ordered.  

On March 22, the government regulated intra-state movement of private vehicles, two-wheelers and taxis on an odd-even basis (allowing plying of vehicles on alternate days as per the number plate) until April 15, 2020.  The government also reduced the budget session of the state to two days on March 23. 

On March 25, the central government announced on a 21-day country-wide lockdown till April 14.  During the lockdown the state government took various steps for physical containment, health, financial and welfare measures.  These are detailed below.

Measures taken during lockdown

Movement Restrictions

Certain movement restrictions were put across the state.   These include:

  • Movement of vehicles: Inter-state movement of vehicles was restricted to vehicles transporting essential goods.  These vehicles need to have a permanent pass for such movement.  On April 5, intra-state movement of vehicles was restricted to government officials, transportation of essential commodities, banks and PSUs, and media and cable networks.   Their passes are valid only from 8am to 5pm.
     
  • Validity of passes:  The state government noted that a large number of vehicle passes were issued due to various reasons.  On April 14, the government ordered that all passes issued by District Magistrates, and other Departmental Authorities (except those issued by the police, health department and forest and environment department) will be invalid from April 14.  New passes will be issued only by Magistrates and Block Development Officers.  
     
  • Securing borders:  In view of the COVID-19 pandemic and to check unauthorised cross-border infiltration from China, Nepal, and Bhutan, the state government secured all porous borders along the Rangpo river and other vulnerable areas.

Essential Goods and Services

On April 5, the state government issued an order requiring establishments such as shops, hotels, private offices, and commercial establishments to remain closed until April 15.  Establishments which were permitted to remain functional include law enforcement agencies, health services, electricity and water services, petrol pumps, and media.  Shops for PDS, groceries, vegetables, milk and, medicines were only allowed remain open from 9 am to 4 pm.

  • Valid prescription and label required:  On March 25, the state prohibited the sale of hand sanitisers without drug manufacturing licence label.  It also prohibited sale of N95 masks to general public without valid prescription. 
     
  • Transit camps:  On April 17, the state government notified that transit camps (temporary accommodation) will be set up for drivers and helpers of vehicles carrying essential goods.

Health Measures

On March 31, the Sikkim government identified and set up dedicated isolation wards and treatment centres in the STNM hospital, Sochakgang as a precautionary measure.  The government also issued directions for citizens to avoid getting infected by coronavirus.  These included social distancing, and maintaining proper hygiene.  

On April 18, the state government made it mandatory for all the public, students, teachers, and government employees, to install the Aarogya Setu application.  The government of India launched a mobile app called ‘Aarogya Setu’ to enable people to assess the risk of catching COVID-19 on April 2, 2020.   The app uses Bluetooth and Global Positioning System (GPS) based device location for contact tracing in order to prevent the spread of COVID-19. 

Welfare Measures

  • Economic relief package:  On March 27, an economic relief package was announced by the state government.   This included free ration in specific quantities (other than the PDS entitlement) to needy families in rural and urban areas, daily wagers, migrant labourers, casual workers, and stranded people.  Further, the government announced an additional incentive wage of Rs 300/day for tea workers at Temi-tea estate. 
     
  • Food distribution:  On April 16, the government announced that Asha workers will be given Rs 5,000 as honorarium for work done during COVID-19.  Further, it ordered the food and civil supply department to compile a list of all the left out beneficiaries for distribution of food relief packages.
     
  • Relief to stranded patients:  On April 16, the government announced that a financial relief of Rs 30,000 will be provided to each patient undergoing treatment and stranded outside Sikkim from the Chief Minister's relief fund.
     
  • Relief for casual workers:  On March 30, the Sikkim government issued directions to all contractors/ employers to pay migrant and casual labourers on the due date without any deductions due to the lockdown.  The state government also provided grants worth Rs 2,000 to the 7,836 registered building and other construction workers in the state.
     
  • Relief for stranded students:  On March 29, the state announced that it will provide Rs 5,000 to each state student stranded outside Sikkim during the nationwide lockdown.

Certain relaxations after 20th April 

On April 14, the nation-wide lockdown was further extended till May 3, 2020.  On April 15, the Ministry of Home Affairs issued guidelines outlining select activities which will be permitted from April 20 onwards.  These activities include health services, agriculture related activities, certain financial sector activities, operation of Anganwadis, MNREGA works, and cargo movement.  Further, subject to certain conditions, commercial and private establishments, industrial establishments, government offices, and construction activities will also be permitted.  The Sikkim government took the following steps in the same line.

  • On April 19, the state government gave directions to all government and PSU offices to work with up to one-third of their actual staff strength from April 20 onwards. 
     
  • On April 19, the state government gave directions and standard operating procedures to be followed at manufacturing establishments, work spaces and public places post April 20.  These include: (i) no overlapping shifts, (ii) staggered lunch breaks, (iii) training on good hygiene practices, (iv) compulsory wearing of face cover, and (v) sanitising workplaces between shifts. 

For more information on the spread of COVID-19 and the central and state government response to the pandemic, please see here.