RAJASTHAN GOVERNMENT IMPLEMENTING MEASURES
TO BRING THE ECONOMY BACK ON TRACK
Apart from undertaking stringent measures to contain the spread of the novel coronavirus and to ensure the welfare of those grappling with the crisis at the ground-level, the Government of Rajasthan has announced few impactful measures to steer the state out of the economic juggernaut that the proliferation of COVID 19 and the subsequent lockdown is likely to bring in.
While the Government of Rajasthan, led by Mr. Ashok Gehlot had imposed total curfew in Bhilwara municipal area and a state-wide complete lockdown days before the nation-wide lockdown was imposed by the centre, its economic implications on the State had been critical. With demand plummeting and with lesser availability of labour force, it will take at least 3 months for the industry to recoil to normalcy.
Speaking on the economic impact, the Government had stated that, while the revenue is almost nil, expenditure has multiplied exponentially. The realized revenue between March 10 and March 31, 2020 is roughly Rs 3500 crore less than the revenue in the same period a year earlier, ie. 2019. Also, between 1st and 7th April, the revenue collected is Rs 300 crore less than the revenue collected between April 1 and April 7th, 2019. The collection of commercial tax, excise and other taxes which normally take place in the last week of March, has also been severely impacted due to the lock down. In terms of expenditure, over Rs 2600 Crore has been spent on PPE equipment, ventilators, an increase in the number of testing of patients and in other welfare measures such as the distribution of wheat through PDS’s, etc among 5 crore people. While 5Kg of wheat is provided by the central Government, the state Government is also distributing another 5Kg for free, to the needy. Apart from this, social security pensions have also been increased.
Besides, a special group has also been set up under the chairmanship of the former finance secretary who is currently an advisor to the Chief Minister. This said group is working on specific activities that are to be taken up to minimize the economic impact of COVID 19, once the lockdown is lifted in a phase-wise manner.
Further, the Chief Minister has written letters to the Prime Minister, demanding the release of grants from the PM Cares fund, deferment of loan payments sans interest and several other measures to meet the state's financial requirements in these times of slowdown. The CM has also requested for a Rs 1 lakh crore package to be given to all states, basic criteria such as the size of the population and the number of COVID 19 positive cases in the concerned State. As per the calculation, Rajasthan's share in the package is approximately around Rs 5,000 crore. Additionally, the Chief Minister has also requested the centre to allocate the state share in central taxes for the month of April at the beginning of the month. In the normal course, the share is given at the month-end.
To tackle the impending financial insolvency, the Government has also requested to escalate the state's borrowing limit by two percent and to expeditiously release pending GST compensations. The Rajasthan Government has already announced the partial suspension of gross salaries across four key segments (70 percent, 60 percent, 50 percent, and 30 percent) from the level of the chief minister to employees, except for those in medical and healthcare services, police constables, class IV employees, and contractual workers, for the month of March.
The Government has also deployed a number of measures to help the farming community. For example, a 21-day advance payment has been given to the farm labourers so that they can purchase essential items and food, in the midst of lockdown and social distancing.
Also, since harvesting of crops starts in Kota from 15th March onward and in the rest of the state, from April 1 onward, procurement from Kota will start from 16th April, while for other districts, registration will start from 16th April. In order to stagger the crowd and to reduce the transportation distance, the Government has doubled the number of collection centres. Earlier Mandis were the regular collection centres, now, 400 GSS (Gram Seva Samiti) have been roped in and many more mandis. It has also requested the center to increase the limit of 25% of procurement for MSPs to 50%, so that farmers and the needy are benefitted and also those who are living in the quarantine camps, including the destitute. The administration is putting in all possible efforts to ensure that none of the State’s residents face any problems in gaining access to essential items. The State Government has asked the centre to make FCI food stocks available for all as the warehouses are currently full to the brim.
Inspite of the lockdown and sealed borders, the transportation, and supply of essential commodities has been consistent across the State. In order to ensure this, the Government had earlier issued a revolutionary order wherein it granted automatic permission to all already permitted industries to operate without the need for any separate permission, with strict instructions to take all precautionary measures against the spread of COVID 19. There are around 200 such continuous industries, including manufacturers of food, drugs, Ayush drugs, pharmaceuticals, medical devices, coal and minerals, and hygiene products as well as the industries that are providing raw material to these industries, among others. Rajasthan also supplies raw materials and other supplies to many other states.