Haryana's socio-economic development will depend on the reduction in inter-district disparities and improving sex ratio - Finance Commission

Transition to Peri-Urban Agriculture may prove as a game changer in doubling farmer's income - State Govt.

Despite high consistent growth clocked by Haryana in the past couple of years, sustainability of its growth will depend on how fast it is able to reduce its inter-district disparity. Addressing a Press Conference after the detailed meeting with Govt of Haryana on a wide ranging issues, acting Chairman of 15th Finance Commission, Dr. Ashok Lahiri said that Haryana has improved its fiscal management and implemented IFMS and PFMS but the state has a long way to go to ensure appropriate quality of expenditure particularly capital expenditure which is necessary to fill the gap in expenditure needs for infrastructure.

He placed on record the Commission's appreciation for adoption of SDGs in the developmental priorities of the state, however there was a continued need to improve the sex-ratio and increase expenditure in health and education sector. Though the results of GST implementation are yet to be seen fully, Haryana is doing reasonably well in its collection despite the complexity of the system. Haryana stands 3^rd in GST collection. Govt of India has assured 14% revenue buoyancy for four years which covers the first year of the award period of the 15^th Finance Commission. New financing mechanism needs to be evolved due to the abolition of the Planning Commission and distinction between plan and non-plan funds.

Commission noted that significant improvements have been made in the working of the power sector in achieving targets of UDAY by both the DISCOMs and state govt. The endeavor to switch to solar energy for meeting the energy needs of agriculture and also to supply the feeder is encouraging.

Haryana needs Equity and Efficiency based model for financial devolution

 Chief Minister Shri Manohar Lal and Finance Minister Capt. Abhimanyu welcomed the Commission before a detailed and pointed presentation on state finances were made by the officials. Presentation went on for more than 3 hours. In his welcome remarks, Chief Minister thanked the members for their positive and focused approach in understanding various issues related to the state. In his speech, Chief Minister highlighted the result oriented approach of the state govt. in reaching the last man with the philosophy of Ántyodaya. He said -

1. State govt is committed to double farmers' income by 2022.
2. Govt has launched a new scheme to protect the farmers from distress sale and glut in the market.
3. State has become ‘Kerosene Free’ from 1st April 2017 resulting in saving of about ₹ 300 crore annually on subsidies.
4. State stands first among North Indian states in Ease of Doing Business.

Finance Minister said that all fiscal parameters except revenue deficit are within the limits of the FRBM Act. Development of infrastructure is one of the priority areas for the govt. He sought more funds for development of infra projects of national importance, particularly considering that 40% of the state is part of NCR. He also emphasised the special requirements of grants for disaster management in NCR region considering the high population density, high rise buildings, inadequate scientific study for emergency operations and the fact that the region is in seismic Zone IV.

State Govt. emphasized on following:

1. Equity and efficiency based model for financial devolution.
2. To consider parameters like disparities in development among the districts, capital expenditure, adoption of PFMS, improvement in Sex Ratio and Younger Demographic Profile for devolution.
3. To consider along with forest area, cropped area and irrigated area also for devolution.
4. To consider scientific interventions and therefore more funds in agriculture specially for eliminating stubble burning there by reducing pollution. Also consider micro irrigation in Dark Zones .
5. There is a need to move from crop agriculture to Peri-Urban agriculture to increase the income in agricultural sector.

The Chief Minister submitted a detailed Memorandum to the Commission. Chairman complemented the Govt. of Haryana for making an illuminating presentation to the commission regarding the opportunities and challenges in all the sectors of the economy of the state. He also stated that the issues raised would receive appropriate consideration during deliberation in the Commission.

Important suggestions by representatives of Political Parties, Local Bodies and Trade and Industry

Commission also sought views of the leaders from various political parties, local bodies and representatives from Trade and Industry. They emphasised some important points like : 

1. Reversing the harmful effects of the green revolution.
2. Ecological preservation
3. Problem of unemployment
4. Education infrastructure
5. Protected Agriculture by making available money for inputs
6. Developing commercial livestock.
7. Infrastructure and incentives for industries

15th Finance Commission is on a 3 day visit to the state of Haryana from yesterday (3rd May 2018). The Commission appreciates the constructive and useful suggestions made by the State Govt towards empowerment of the states and their development and appreciated the the warm hospitality extended by the State Govt. The Commission also looked forward to continuing interaction with the State Government. Commission will finalise its recommendations by October 2019 after completing its discussions with all the State Governments, the Government of India and relevant stakeholders.

Financial devolution reform urged to account for intra-state disparities and capital needs, shaping state funding allocations. Haryana's priorities include reducing inter-district disparities and improving the sex ratio, shifting expenditure toward quality capital outlays and increased health and education spending. The state seeks an Equity and Efficiency based model for financial devolution that incorporates disparities, capital expenditure, PFMS adoption, sex-ratio improvement and demographic profile, and requests devolution criteria to consider cropped and irrigated area, scientific agricultural interventions, micro-irrigation, peri-urban agriculture, and targeted disaster-management and infrastructure grants for NCR.