Karnataka: Thriving Economy Helps CM Bommai Unveil A Revenue Surplus Budget, Per Capita Income Rises To Rs 3.32 Lakhs, GSDP Estimates At Rs 23.33 Lakh Crores

Karnataka Chief Minister Basavaraj Bommai today (Feb 17) presented a revenue surplus budget with no tax hike months ahead of the state assembly elections in April-May.

“Higher growth rate in GSDP in the financial year 2022-2023 has enabled increased capital expenditure, attracting investment and creation of employment on large scale. This reflects the concentrated efforts taken by the State Government.” CM Bommai, who also holds the finance portfolio, said in his budget speech.

“Compared to previous year, in the year 2022-2023, service sector has recorded the growth at 9.2%, Industrial sector grew at 5.1%. Despite erratic weather conditions, agriculture sector has seen a growth of 5.5%.” the CM said.

Karnataka’s overall GSDP recorded a growth of 7.9% in 2022-23, per advance estimates of the Directorate of Economics and Statistics, Bommai informed the legislature during his budget speech.

In his budget speech, the CM noted that the state’s per capita income is now at Rs 3.32 lakh, which easily makes it among the wealthiest state in India.

The state’s provisional estimate of GSDP for 2023-24 is Rs. 23.33 lakh crore, while the revised GSDP estimate for 2022-23 was Rs 21.87 lakh crore.

The CM proposed a budget outlay of Rs 3.09 lakh crore for the state in 2023-24, up from Rs 2.65 lakh crore in 2022-23. 

The budget forecasted a revenue surplus of Rs 402 crore in 2023-24, with revenue receipts estimated at Rs 2.26 lakh crore and revenue expenditure at Rs 2.25 lakh crore,

The capital expenditure by the state in 2023-24 was pegged at Rs 58,327 crores representing an increase of 10% over the previous year.

The fiscal deficit, estimated to be Rs.60,581 crore, is at 2.60% GSDP, well within the parameters specified in the Karnataka Fiscal Responsibility Act, 2002.

“As a result of our government implementing several progressive policies and fiscal consolidation measures and exhibiting fiscal discipline with steadfast commitment, it has been possible to steer the State economy on the path of progress again,” CM Bommai said. 

The CM announced a slew of welfare schemes in the budget, including ‘Shrama Shakthi’, which will provide financial assistance of Rs 500 per head every month to landless women farm labourers through direct benefit transfer (DBT).

Aimed at enabling all children who graduate from high school to continue their higher education, CM announced free education in Government Pre-University and Government Degree Colleges under ‘CM Vidya Shakti Scheme’. This will benefit eight lakh students of the state, he added.

Seeking to woo farmers in an election year, he announced an increase in the limit of interest-free short-term loans given to farmers from Rs 3 lakh to Rs 5 lakh from the coming financial year.

“This year, loan of Rs 25,000 crore will be distributed to more than 30 lakh farmers,” he said.

The CM also proposed increasing the size of the revolving fund — meant for market intervention during times of a price crash through procurement of foodgrains under MSP scheme — from Rs 2,000 crore to Rs 3,500 crore. “This is the highest quantum of the revolving fund in the history of the State dedicated for MSP operations,” the CM said.

The government, Bommai said, decided to give an additional subsidy of Rs 10,000 in the year 2023-24 under a new scheme, ‘Bhoo Siri’ for ‘Kisan Credit Card’ holders.

The Chief Minister said that this would facilitate the farmers to purchase seeds, fertilisers, pesticides and other farm inputs in times of exigencies.

The state would contribute Rs 2,500, and NABARD (National Bank for Agriculture and Rural Development) would give Rs 7,500. “This will benefit around 50 lakh farmers of the state,” he said.