Assam govt seeks financial support from Centre

The state government has taken Rs 10,000 crore as inherited  liabilities.

Assam Chief Minister Sarbananda Sonowal on Saturday met Prime Minister Narendra Modi and Union Finance Minister Arun Jaitley and urged for financial support to the state.

Sonowal met  Modi at his official 7 Race Course Road residence and submitted a memorandum and a White Paper on the State’s finance situation.

In the 25-minute discussion with the Prime Minister, the first after becoming the Chief Minister, Sonowal pointed out the state’s financial condition with about Rs 10,000 crore committed liabilities it has inherited from the previous government.

Sonowal said that while the state government has been shifting focus to augment internal resources without depending on the Central government alone, the state’s existing ‘precarious financial position’ has necessitated special support from the Centre, more so during the transitional phase.

The Chief Minister said that his government has been seriously trying to tap the inner strengths of the state within the limited capacity and resources to generate internal resources, attracting investments and building on the core strengths.

“Our Government has decided to surge ahead with Restructuring Systems and Technology for Augmentation of Resources for Transformed Assam (ReSTART Assam) to mop up maximum possible resources through a coordinated and concerted mission mode programme with four-pronged action plan viz., rationalize the revenue collection through reforms and restructuring of policy, legislations and administration; mobilizing additional resources in a big way through Externally Aided Projects; focusing on institutional reforms for improving public finance management with focus on  investments in critical sectors and on large scale IT-enabled systems with ‘near-zero human interface’ and real time monitoring of revenue collection,” Sonowal said.

Pointing out that the time-bound action plan ‘would bear fruits only after two-three years’, the Assam Chief Minister said in the interim period while there is a need to focus on development, the state needs about Rs 10,000 crore to honour the committed liabilities accumulated over a period of time and other liabilities arising out of pay revision of employees.

‘Thinking big and coming up with transformational ideas’ as the driving force of his government, Sonowal said this approach would enable the state to develop its resources internally through massive investments and not to be ‘dwarfed into the dependency attitude’.

“Thinking big is the natural choice of our government to usher in ‘paribartan’ (change) in the lives of the people of Assam who have given us an unprecedented mandate,” Sonowal said.

The Assam Chief Minister requested the Prime Minister for financial assistance for infrastructure projects such as roads, river, power and IT as well as service sector.

“Our State would like to focus on developing multi-modal transport keeping Brahmaputra and Barak waterways as centre of design; four-lane roads connecting all district headquarters, hinterlands with markets across the borders; hydel (micro and mini), thermal and solar power plants so as to ensure 24X7 quality power supply; high speed broadband connectivity to each village and household, giving adequate thrust on tourism, BPO, industry and other associated employment-led service sectors and in making Assam an organic hub,” Sonowal said, pleading with the Prime Minister  for requisite financial support over a period of five years to give a shot in the arm to the internal revenue generation efforts of the state government.

Sonowal requested the Prime Minister to release the Rs 10,000 crore crude oil royalty to the state and to use his good offices to ensure price of crude oil at pre-discounted rate as in the case of Gujarat following an interim order of the Supreme Court.

The Assam Chief Minister pleaded for early release of the Rs 1226 crore the Ministry of Water Resources owes to the state under the Flood Management Programme (AIBP-FMP).

Referring to the gaps in devolution of Central taxes and revenue deficit grants, Sonowal said while the 14th Finance Commission in its assessment of state resource stated it had taken into account ‘cost disability or fiscal capacity’ and made efforts to fill the gaps in resources, in reality its recommendations did not reflect the same thus depriving Assam to a great extent.

“Assam has been deprived to a great extent has been evident from the fact that while the State was awarded a revenue deficit grant of only Rs 3379 crore during 2015-20, smaller States like Nagaland, Mizoram, Manipur, Himachal Pradesh and Jammu & Kashmir were rewarded handsomely by 14th FC,” the Assam Chief Minister said.

Sonowal urged the Prime Minister to allot Rs 5,000 crore annually as a ‘special one-time revenue deficit grant so that the state can take up development projects as envisaged in our Vision Document 2016-2025.

Following the Chief Minister’s plea for one-time help and support to trigger generation of its internal revenues and to minimize the State’s dependency on the Centre for grants, Prime Minister Modi assured all help and support to the new government to bring turnaround in the economy of the State.

After meeting the Prime Minister, Sonowal met Union Finance Minister Arun Jaitley and discussed a gamut of issues pertaining to the state’s present financial position and the need for the Centre to come up with special assistance to help the state tide over the crisis.

The Assam Chief Minister submitted the White Paper on the State’s finances his Government had brought out recently.

Jaitley assured Sonowal of his Ministry’s support and help to bail out the state from the financial quagmire it finds itself in.

(Reporting by Hemanta Kumar Nath)