New Delhi: The Department of Expenditure of the Finance Ministry has approved Rs 179 crore for capital projects to Telangana. This is in addition to the Rs 179 crore capital projects previously approved in the state.
Out of the four citizen-centric reforms to the state, this additional amount has been approved as an incentive for undertakings of One Nation, One Ration Card, Easy of Doing Business (easy to do business), and Urban Local Bodies Reforms. The projects have been approved under the newly launched scheme of “Financial Assistance to States for Capital Projects”.
Telangana has become the second state in the country to be given additional capital under this scheme. Earlier, Madhya Pradesh was given additional capital of Rs 660 crore for capital projects. The state received this additional amount after completing three of the four citizen-centric reforms. The citizen-centric sectors identified by the Government of India for reforms by states are One Nation, One Ration Card Reforms, Ease of Doing Business Reforms, Power Sector Reforms, and Urban Local Bodies Reforms.
Out of the additional sanctioned amount of 179 crores, an amount of 89.50 crores has been released to the state as the first installment. All the capital projects undertaken by the Telangana State Government with additional capital are in the road sector.
The scheme of “Special Assistance to the States” was announced by the Finance Minister on October 12, 2020 under the Self Dependent India Package. The scheme aims to increase capital expenditure by state governments, which are facing financial crisis this year due to loss of revenue due to the Kovid-19 epidemic. Capital spending has an impact on several levels to accelerate the economy. The benefit of which is reflected in the economic growth rate. Therefore, the Central Government decided to provide special assistance to the State Governments in relation to capital expenditure in FY 2020-21, despite adverse financial situation.
The scheme has been warmly welcomed by the state governments. So far, capital expenditure proposals of Rs 10835.50 crore have been approved by the Ministry of Finance to 27 states. An amount of Rs 5417.70 crore has already been released to the states as the first installment under this scheme. State-wise allocations, clearances granted and funds released are attached. Tamil Nadu has not availed this scheme.
Capital expenditure projects have been approved in various sectors of the economy such as health, rural development, water supply, roads and bridges, irrigation, electricity, transport, education, urban development.
The plan has three parts. Part-1 of the plan covers North-Eastern and hilly states. Under this, each of the 7 northeastern states (Arunachal Pradesh, Meghalaya, Manipur, Mizoram, Nagaland, Sikkim and Tripura) are allocated Rs 200 crores and an amount of Rs 450 crores, to each of the hill states (Himachal Pradesh, Uttarakhand) Has been allocated. Also, in view of more population and more geographical area in the state of Assam, an additional amount of Rs 450 crore has been allocated under the scheme.
Those states have been included in Part-2 of the plan, which is not included in the first part. An amount of Rs 7,500 crore has been kept for this part. This amount has been allocated to these states on the basis of the ratio fixed under the share in central tax by the 15th Finance Commission for the financial year 2020-21.
Part-3 of the scheme aims to advance various citizen-centric reforms in the states. An amount of Rs 2000 crores has been approved under this part. This amount will be available only to those states, which will implement at least 3 out of the 4 reforms decided by the Finance Ministry on 17 May 2020, by 15 February 2021, and send their recommendations in this regard to the Nodal Ministry.