Srinagar, Mar 5: The 13th Finance Commission has recommended Rs 2,600 crore annual hike in the share of non-plan expenditure and central taxes for cash-starved Jammu and Kashmir for the next five years.
Official sources told Greater Kashmir that the 12th Finance Commission had awarded Rs 12,000 crore non-plan revenue deficit grants to JK spread over five years - Rs 2,400 crore per annum. However the devolution has been stepped up to Rs 3, 900 crore per annum in the 13th Finance Commission award for the state.
Besides, there has been an increase of around Rs 1,100 crore in the share of the central taxes compared to last five-year plan. The 13th FC recommendations were tabled by the Union Finance Minister in Parliament on February 25.
The increase in the grants for JK is likely to solve the state’s major problem of meeting an extra expenditure of Rs 1700 crore on account of substantial enhancement of salary for around 3.5 lakh government employees due to the implementation of the 6th pay commission recommendations last year.
“Obviously the amount of Rs 2600 crore will help us to meet the non-plan expenditures including salaries,” officials said.
Coming to the rescue of the dying Wullar Lake - Asia’s largest fresh water reservoir - the Finance Commission has approved Rs 300 crore for its conservation besides around Rs 20 crore have been provided for development of the Ladakh region.
“There has been a step up of more than 2 per cent share in the award for the states which was fixed at 30 percent for the last five year plan,” sources said.
Bailing out the state government from the debt of the Jammu and Kashmir Bank on account of the continuing overdraft of Rs 2200 crore, the Commission has conditionally approved Rs 1000 crore to meet the liabilities.
However the state government has been asked to ensure fiscal reforms and follow the Reserve Bank of India guidelines on institutional borrowings.
“As per the guidelines the state government can avail loaning facility to the tune of Rs 450 crore from a financial institution but has to repay it within 15 days,” sources said.
A state finance department official said the state has also been awarded Rs 5,000 crore as specific grants for development in sectors including forest, irrigation, education and building.
However the big disappointment for the JK government has been the Finance Commission’s rejection for approving special funds of Rs 4000 crore for payment of arrears to its over 3.5 lakh government employees from January 2006 when the 6th pay panel report was implemented in the state.
“The government had asked the Commission to consider Jammu and Kashmir as a special case for approving funds for payment of the arrears. However the state government’s plea has been rejected. Even the central government is not ready to pay for the arrears. The problem for the centre it seems is that if they give nod to state they will have to follow the same rule for other states which have also implemented the pay panel report,” said a top official of the Finance Department.
Commission has recommended Rs 50 crore for the creation of new modern legislative complex at Jammu besides Rs 25 crore for protection and reinforcement of the Tawi front to protect river from pollution, improve drinking water supply and prevent damage to property during floods.
Rs. 15 crore has been recommended for construction of Public Service Commission building at Srinagar. Besides Rs. 15 crore has been approved for renovation and modernisation of transmission and distribution system in Leh District. In addition Rs 5 crore have been recommended for development of eco-tourism in the Leh.

Lastupdate on : Fri, 5 Mar 2010 21:30:00 Makkah time
Lastupdate on : Fri, 5 Mar 2010 18:30:00 GMT
Lastupdate on : Sat, 6 Mar 2010 00:00:00 IST