Here is a reality check on why despite pegging the development expenditure at Rs 1.06 lakh crore in the 2021-22 budget, Odisha lags behind in the indices of development in the country.
As per the recently released RBI report 'State of State Finances-2021', when Odisha spends 62.8 percent of its total expenditure on development in 2021-22, neighbouring Andhra Pradesh, Chhattisgarh and Jharkhand spend 68.8 percent, 72.2 percent and 70.8 percent, respectively.
Development Expenditure Has Poll Link In Odisha?
A detailed glance at the RBI report shows that during the election year of 2019-20, the spending on development in Odisha had been 71.8 percent of total expenditure in the year.
Moreover, during the poll year, Odisha's development expenditure vis-a-vis the aggregate expenditure had been highest among the neighbouring states.
But when the pandemic hit the State, Odisha's spending on development took a beating. In contrast, the spending for development purposes in the neighbouring states received a boost.
Sample This
As per the RBI report, in the 2020-21 (Revised Estimates), the development expenditure in Odisha had come down to 68.4 percent of total expenditure. And in the second-wave hit financial year (2021-22), the spending on development dropped further to 62.8 percent of the aggregate expenditure.
On the contrary, in Andhra Pradesh, the development expenditure in proportion to total expenditure in the poll year (2019-20) had been 61.1 percent. The proportion shot up to 63.9 percent in 2020-21 (RE) and 68.8 percent in 2021-22 (BE).
Similarly, the figures for Chhattisgarh had been 67.9 percent in 2019-20 (poll year), it jumped to 72.4 percent in 2020-21(RE) and 72.2 percent in 2021-22 Budget Estimates (BE).
For Jharkhand, the numbers were: 65.8 percent (2019-20), 70.1 (2020-21 RE) and 70.8 percent (2021-22 BE).
The above number-crunching shows a consecutive dip in spending on development activities after the polls in Odisha vis-a-vis the other states.
Odisha Goes Weak On Development Pillars?
- Education: A glance at the State of State Finances report of RBI, Odisha falls behind states like Bihar, Chhattisgarh, Assam, Jharkhand and West Bengal in spending on education.
The State's proportion of expenditure on education with respect to total expenditure in the year 2021-22 (BE) has been 12.7 percent. Bihar and Chhattisgarh's spending had been 18.1 percent each, Assam (18.6 percent), Jharkhand (14.9%) and West Bengal (15.5%), respectively.
During the poll years of 2009-10, the expenditure on education vis-a-vis total expenditure had been 18.3 percent. In the poll year 2013-14 it had been 15 percent, 14.9 percent in 2018-19. Even though the pandemic had called for more spending on improving online education infrastructure, the spending dropped to 13.7 percent in 2020-21 and 12.7 in 2021-22.
- Health: As per the RBI report, spending on another vital development pillar - the Health and Family Welfare, Odisha was found trailing behind neighbouring states like Andhra Pradesh, Assam, Bihar, Chhattisgarh and West Bengal.
Odisha has earmarked 5.5 percent of total expenditure for Health and Family Welfare in 2021-22 BE, whereas the corresponding spending by Andhra Pradesh has been 6.1 percent, Assam (6.9%), Bihar (6%), Chhattisgarh (5.8%) and WB (5.9 percent), respectively.
- Rural Development: This is also a vital pillar because 82 percent of the population in Odisha resides in rural areas. Here too the State was found lagging in spending vis-a-vis the total budgetary expenditure from the neighbouring states like Bihar, Jharkhand and West Bengal.
While Odisha could earmark 7.5 percent of total expenditure for rural development in 2021-22, Bihar earmarked 11.6 percent, Jharkhand 15.1 percent and West Bengal 8.1 percent.
- Agriculture: From the erstwhile Planning Commission to incumbent Niti Aayog, the common policy prescription for Odisha has been investing more in agriculture and allied activities to pep up the poor per capita income in the State. Here too the State fares poorer than neighbouring Chhattisgarh and agriculturally advanced Punjab.
As per the report, when Odisha has decided to spend 7.4 percent of its total expenditure in 2021-22 on Agriculture and allied sector, Punjab has earmarked 10 per cent and Chhattisgarh 17.2 percent of total spending for the farm, diary, poultry and fisheries sector.
The spending in Punjab and Chhattisgarh had been higher by quantum than Odisha as the states had provisioned more money for agriculture marketing, subsidies, horticulture and waiving off farm loans.
Sample This: Despite a smaller state, Chhattisgarh has earmarked in 2021-22 budget a sum of Rs 8,56,406.6 lakh for crop husbandry. In contrast, Odisha has provisioned Rs 5,82,193.5 lakh for crop husbandry in the 2021-22 budget.
Neighbouring Chhattisgarh had provisioned Rs 16,49,055.8 lakh for the Agriculture and Allied services in 2021-22, whereas the allocation in Odisha had been Rs 10,42,817.7 lakh.