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Economy

Union Budget: Allocations to Northeast See Dip After Spending Declines in FY 20-21

For instance, the amount allocated for road projects in the northeastern region in FY 2020-2021 was Rs 801 crore. But the amount spent was Rs 409.62 – leading the finance ministry to allocate only Rs 696.24 crore this time.

New Delhi: In her budget speech on February 1, Union finance minister Nirmala Sitharaman mentioned that a sum of Rs 3,400 crore had been allotted by her ministry for road infrastructure in poll-bound Assam in the 2021-22 financial year – evoking a round of applause from the BJP MPs at the Lok Sabha, including Prime Minister Narendra Modi.

However, if one goes by the Union finance ministry’s statement on 2020-21 budget spending, what is apparent is that the Modi government had spent far less in the Northeast under the DoNER (Department of North East Region) ministry than it had pledged in the last Union Budget. 

Skimming through the last budget (FY 2020-21) shows that since the Central government had spent – uniformly – far less in the region in the past financial year. The budget allocation for the northeast in FY 2021-22 has also dipped under most heads. 

The amount allocated for road projects in the northeastern region in FY 2020-2021 was Rs 801 crore. But the amount spent was only nearly half of it – Rs 409.62 – leading the finance ministry to allocate only Rs 696.24 crore, which is less than the amount set aside in the last budget.

Also read: Snapshot: Budget 2021 and Key Sector Allocation in Seven Charts

Similarly, while the total ‘special development package’ allocated to the Bodo Territorial Council, Karbi Anglong Autonomous Council and the Dima Hasao Territorial council was Rs 101 crore, the revised amount spent was only Rs 34 crore. Nearly 70% less than the amount pledged. For the FY 2021-2022, the central funding under this head has been reduced to Rs 70.75 crore, about 30% less than the last budget. 

So, while the FY 2020-2021 budget for cumulative central sector schemes and projects was Rs 3027.65 crore, the revised budget allocation for that year showed only Rs 1839.28 crores. This reduction in the actual spending has had its effect on the FY 2021-2022, in which the sum allotted is Rs 2637.49 crore.

Under the ‘other central sector expenditure’ heading in the DoNER ministry, Rs 3048.73 was the budget allocation for FY 2020-2021. The expenditure shown was only for Rs 1,860 crore, leading the Centre to allocate less than it did in the FY 2020-2021. The sum allocated in FY 2021-2022 is Rs 2,658 crore.

Also read: Budget Allocation for Northeast’s Territorial Councils Increased

Under the ‘general services’ head too, the amount pledged in the last budget by the finance minister was Rs 40.68 crore but the expenditure shown in the statement was for Rs 37.31 crores. Now, at Rs 37.20 crore, the amount allocated for the FY 2021-2022 is less than it was in the last budget.   

Sitharaman had announced a sum of Rs 1225.75 crores under the ‘central sector schemes and projects’. But the revised budget under that head showed Rs 787.56 crore, about 30% less than the amount pledged. But, contrary to the other heads, the amount pledged for these schemes for FY 2021-2022 is Rs 1225.95 crore, an increase of Rs 20 lakh. This is the only increase noted in the DONER ministry budget statement. 

Though the ministry has not yet cited any reason for spending less in the region than what was allocated in the budget in FYI 2020-2021, one of the possible factors could be the pandemic and the resultant lockdown.