Facts of figures

 Nagaland chief minister Neiphu Rio’s 2020-21 budget estimate was anything but a sugar-coated pill despite a hefty increase of Rs.21,068.85 crore against Rs.17,606.48 crore for 2019-20. The two financial years show that the 2020-21 budget has an increase by Rs.3462.37crore. Earlier when Rio presented his 2019-20 budget the estimated deficit was Rs.1,611.98 crore while in his 2020-21 budget ,the deficit was estimated at Rs.2358.81 crore. No new tax was proposed in the 2019-20 budget but in the 2020-21 budget Rio raised duties on petroleum and also on transport and heavy machineries. There is no debate that the huge financial deficit faced by the government of Nagaland should have ignited spontaneous clamour for stringent austerity drives by cutting down on unproductive entertainments, funding token populist projects etc. It remains to be seen as to how the state would be able to greatly reduce this huge deficit since it is less likely that the Centre would grant a substantial amount to do that. Even raising new taxes will not be able to make up the deficit. The consequences of such a situation will only lead to continuation of an inability to provide for state share for central projects. It will be wrong to blame the financial mess on the politicians only. Bureaucrats in Nagaland have also been responsible, if not mostly, for fiscal indiscipline. Part of the problem is that handling of the finance portfolio seems to be confined to meeting the requirements of politicians in getting money to spend . However the ‘getting’ is mostly from the Centre with very little scope for own revenue income. More money does not necessarily translate into improvement of the economy or funding projects to achieve a significant improvement of the condition. If there is another area where the state government needs to look at seriously in order to bring about some measure of financial accountability for enforcing prudent and judicious use of funds. The core issue of good governance is much needed to promote a conducive climate for economic progress. The understanding of proper budgetary management is the saying that one should cut one’s cloth according to one’s size. In this regard, austerity is called for. The state has one of the highest rate of employed in the government, which is eating away around 60% of the budget. This has left very little for needed development projects. The 14th Finance Commission has suggested that planning needs to focus on demography and the GDP of a state and also linking outlays to outputs and outcomes. A state with hardly 20 lakh people and with around 1,40,000 employed which continues to grow. Now there was this suggestion to bring down the number but it is easier said than done. It is quite interesting, that the government continues to hold the belief that the annual ten-day event –Hornbill Festival- has been a roaring success in terms of estimated revenue for unidentified beneficiaries. The benefits out from the ten-day event is essentially a far stretched argument. What ought to be the focus is in for the government to play a catalysing role for progress and not a key player. This will encourage private participation and an all-year round engagement beyond a ten-day event. The fundamentals of economic infrastructure such as power, roads, telecommunications, municipal services etc. is another area where the State will need to consider in playing a continuing catalytic role.