Fiscal Mismanagement and Questioning Benevolence: Congress Criticizes J&K Budget

Congress has criticized the government for unprecedented fiscal mismanagement in the Jammu and Kashmir Budget presented by Union Finance Minister Nirmala Sitharaman. Congress' Jairam Ramesh has raised questions regarding the discrepancy between approved and actual borrowings, the decline in J&K's share of national GDP, heavy taxation, and the financial obligations towards police expenditure taken over by the Union Government.

Days after the Budget for Jammu and Kashmir was presented in Parliament, the Congress on Friday accused the government of ''unprecedented fiscal mismanagement'' and questioned why Union Finance Minister Nirmala Sitharaman was ''benevolent'' to Andhra Pradesh and Bihar but not to the Union territory.

Congress general secretary in-charge of communications Jairam Ramesh stated that Sitharaman presented the Budget for Jammu and Kashmir in Parliament on July 23.

''The present Finance Minister has the dubious distinction of being the only Finance Minister of India who has presented six state budgets, since the Union government has refused to hold Assembly Elections since the dissolution of the J&K Legislative Assembly in November 2018,'' Ramesh emphasized.

''It is our sincere hope that the next J&K budget is presented in the J&K legislature, by an elected Finance Minister, and discussed by legislators elected by the people of J&K,'' he added.

Ramesh claims that Budget documents also reveal some astonishing details. ''The FM got approval from Parliament to borrow Rs 12,000 crore last year. This year, Budget documents reveal actual borrowings amounted to Rs 24,000 crore, double the approved amount. Borrowings have risen five-fold in the past two years—an unprecedented fiscal mismanagement,'' he asserted.

Ramesh pointed out that last year, the finance minister promised to raise Rs 7,800 crore in Additional Resource Mobilisation (ARM) and only managed to raise Rs 1,000 crore.

''The fiscal deficit, originally pegged at 1.6 per cent, turned out to be 5.36 per cent in FY24—more than three times the original estimate. Capex was slashed by 10 per cent. Under the Union Government's tutelage, the share of J&K in national GDP has declined from 0.9 per cent in 2015-16 to 0.8 per cent in 2022-23,'' Ramesh elaborated.

Ramesh also posed several questions for the finance minister. ''How does the grim reality of the state's finances square up with the tax/GDP ratio rising from 5 per cent to 8 per cent in three years? Are the people of J&K being subject to heavy taxation without any corresponding increase in their welfare?'' he asked.

Ramesh further commented on the unemployment rate in J&K, which stood at 17 per cent in February 2023, compared to 6.6 per cent in Andhra Pradesh and 12.3 per cent in Bihar. He wondered why the FM chose to be benevolent to Andhra Pradesh and Bihar but not to J&K.

The Congress leader also expressed concern over the Union Government taking over the budget burden for J&K's police expenditure, which amounted to Rs 12,000 crore. ''This was earlier part of the Security Reimbursement Expenditure (SRE) due to militancy since the early 1990s. Why has it been repackaged from a 'reimbursement' to a new obligation?'' he questioned.

Ramesh concluded with a plea for clarification. ''Has the police salary liability been taken over permanently, or is it a one-time support? Does this reflect an intention to rule the state from Delhi perpetually, retaining home affairs with the Union Government? Will the FM commit in the House that taking over police salary liability is not a Trojan horse, and that security matters will return to the state once J&K is re-upgraded to a full state?'' he concluded.