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HP FRMB (Amendment) Bill 2021: Raising Borrowing Limit Would Lead Himachal into Debt Trap, Will Damage Federal Structure, Says Opposition

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HP FRMB (Amendment) 2021 Bill

Shimla-Himachal Pradesh Fiscal Responsibility and Budget Management (FRMB) (Amendment Bill, 2021, was passed in State Vidhan Sabha on March 18, 2021, after a heated debate between the ruling government and the opposition that was followed by a walkout.

Opposition Congress and lone legislator from CPI (M), Rakesh Singha, opposed the Bill. They alleged that the government has no planning regarding managing state’s finances and dependents upon borrowings only. 

According to the State Government, the Bill was introduced and passed to regularize excess borrowings in the year 2019-20. Previously, the state government could only borrow three percent of the gross state domestic product (GSDP), but after this amendment, this borrowing limit was raised allowing the state government to borrow upto five percent of the GSDP.

The opposition leader Mukesh Agnihotri and CPI(M) MLA Rakesh Singha insisted that it was a very delicate matter that is bound to have serious financial implications for the people of the state. They insisted that this Bill should first be sent to the Select Committee for detailed discussion before passing it.

“If the financial condition was so poor, then the state government should have mentioned in the Budget that it would generate resources through taxes,” Agnihotri said.

He said that this will go down as a black day in the history of the state. He argued that instead of fighting for its share from the Centre, the state government is covering up the fault of the Centre. He also said that the state government was already warned by the CAG in 2018 of the violations of the borrowing limits but it did not act then.

“Passing of this Bill would lead Himachal Pradesh into a debt trap and the state won’t be able to come out of it,” Rakesh Singha said.

“This Bill is an attack on the federal structure of the state,” he said.

Opposition and Singha argued that if this Bill is passed then the interest liability on the post-2022 borrowings would rise and Himachal Pradesh doesn’t have sufficient tax-based resources to repay this liability.

“When the GST was introduced then state governments and Centre government had reached an agreement that compensation at the rate of 14% would be given to the state for the 2017-22 period. The government had also imposed Central cess of various kinds, Singha said.

“However, now the states are being told to borrow as Centre had backtracked from providing the agreed compensation,” he added.

More borrowing would lead to more liabilities including interest-liability, he said, asking as to how the state plans to pay it back.

“I want to appeal that this Bill would have serious implication, therefore, send it to the Select Committee and the Cabinet for detailed debate,” he said.

There is only one solution to it, he said.

“Take your entire Cabinet to the Government of India and request it not to impose it on the State Government. Let the Central Government borrow this money,” Singha said.  The opposition leader Agnihotri also supported Singha and said the opposition legislators would support the state government in doing so.

Moving on to the second objection, Singha quoted the sixth line of the Statements of Objects and Reasons.

“In addition, the State of Himachal Pradesh received one-time receipts from the Union Government on account of its share of Compensatory Afforestation Fund Management and Planning Authority (CAMPA) Funds credited in the Public Accounts, which is included in the public debt of the State,” he quoted from the Bill

He argued that the funds being given to the State for the protection of its own forests can’t be treated as a debt in the account of the State.

The Urban Development Minister Suresh Bhardwaj insisted that the Bills is introduced to regularize an anomaly caused by borrowings of the previous Congress government.

Bhardwaj tried to justify the Bill blaming then Congress government for violation of borrowing limits in the years 2012-13, 2013-14, and 2014-15. He also insisted that it was just a one-time relaxation for the year 2019-20.

Bhardwaj quoted the Bill,

“Provided that the fiscal deficit may exceed the level of 3 per cent but shall not exceed 5 per cent of the estimated Gross State Domestic Product in the Financial Year 20919- 2020.”

In 2013, State’s fiscal deficit was Rs 2978 crores – 3.6 percent, 2012 crores in 2013-14 – 4.23 percent and Rs 4200 crores in 2014-15 – 4.05 percent. The Bills is meant to regularize exceeded limits of borrowings in these years too, Bhardwaj argued.

He also said that the revenue collection of Centre under Goods Services Tax (GST) was low due to the pandemic in the said year due to which the state couldn’t get the share committed by the Centre. Bhardwaj also said that the borrowings increased in 2019-20 as funds of Rs 1600 crores received under the Compensatory Afforestation Fund Management and Planning Authority (CAMPA) were also counted as public debt.

He added that the Statement of Objects and Reasons clearly says “The actual receipts of Central taxes decline during 2019-20 due to which share of States also got affected.”

Following a heated argument, the Bill was passed in the absence of legislators who had walked out in protest against it. 

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Himachal Records 16 COVID-19 Deaths Including a 16-Year-Old – Highest in a Day This Year

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COVID-19 update himachal pradesh april 20

Shimla-The fatality rate due to the COVID-19 spread is witnessing a sharp increase in Himachal Pradesh. Yesterday, the state had reported 13 COVID-19 deaths, but today the fatalities rose to 16 in a day. A total of 1340 new cases were recorded today till 7 pm. Kangra district reported the highest six deaths, followed by Shimla (4), and Una (3).

Find more details about the deceased below:

Highest covid 19 deaths in himachal pradesh

The infection claimed the life of a 16-year-old girl in Una district. According to the state health department’s official report, she developed severe pneumonia and was a patient of Diabetes Mellitus Type-1. Other deceased aged between 36-78 years.

Earlier today, the Deputy Commissioner of Una, Raghav Sharma, had issued orders to keep markets/shops closed on Sundays and issued timings for the remaining days. A prohibition was imposed on all sorts of events and social gatherings. The orders would come into effect from April 22, 2021.

Also Read: Himachal: Govt Announces More Restrictive Measures, DC Una Closes Shops on Sundays, Issues Timing for Other Days

Further, Chief Minister Jairam today announced more restrictive measures as an attempt to contain the spread (Watch Video Below).

Solan district reported the highest 265 cases, followed by Una (173), Shimla (164) and Sirmaur (155).

Find more district-wise details below:

Himachal pradesh daily covid-19 report april 20

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Himachal: Govt Announces More Restrictive Measures, DC Una Closes Shops on Sundays, Issues Timing for Other Days

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hp govt's new restrictions in himachal pradesh

Una-Deputy Commissioner of Una district, Raghav Sharma, has issued an order for the imposition of new restrictive measures from April 22, 2021, in wake of the ongoing spike in COVID-19 cases and fatalities in the district. The DC also expressed fear of community spread and ordered that markets would remain closed on Sundays in both rural and urban areas of the district.

However, these orders would not apply to drug stores, hotels, dhabas, and restaurants. Further, shops selling dairy, vegetables, fruits and meat would also remain open on Sundays from 7 am to 8 pm. Saloons and barber shops would also be allowed to operate on Sunday between 9 am to 6 pm.

All shops would remain open from Monday to Saturday within the given time period, which is 7 am to 8 pm for fruit, vegetable, meat, and dairy shops, and 9 am to 6 pm for saloons/barber shops, and 9 am to 6 pm for remaining shops.

Also Read: With Neighboring States Going to Curfew, Himachal’s Tourism Sector Again Comes to a Halt

A prohibition has been imposed on the organization of all sort of cultural, religious, political, sports and other gatherings in the district. For attending marriages and funerals, the permission of the district administration would be required.

Today, Chief Minister Jairam Thakur also told the media that the number of people allowed in social gatherings, like marriages, has been reduced to 50 for both indoors and outdoors.

For government employees, working days have been reduced to five days a week and staff capacity to 50 percent. Public transport would operate with only 50 percent capacity.

For marriages or any sort of other social, cultural, political events, prior permission of one week would have to be obtained by applying online at the official portal.

The inter-state transport would remain operational, the government said. People returning from high load states were advised to carry COVID-19 negative reports and obey home-quarantine rules strictly.

Orders for Government Employees from Department of Personnel

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COVID-19 Vaccination in India to Open for All Aged Above 18 Years in 3rd Phase: Govt

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All above 18 in india eligible for covid-19 vaccination

New Delhi-From May 1, 2021, everyone above the age of 18 would be eligible to receive COVID-19 vaccination, the Government of India decided today. As per the government, the decision has been taken as a good amount of coverage of vulnerable groups is expected by 30th April.

Pertinent to mention that a demand was being raised to open vaccination for all amid the peaking second wave of the pandemic which is proving to be deadlier than the first one. On Sunday, former Prime Minister of India, Manmohan Singh, had also written to Prime Minister Narender Modi to be more flexible in deciding eligibility for vaccination as it was the only hope. He had pointed out that when we look at the percentage of population instead of the absolute numbers, we see that only a small fraction has been covered so far. He had also suggested reworking on the current model adopted by the government. 

Singh had asked the Prime Minister to allow states to define who qualifies as a ‘frontline worker’.  Many states wanted to designate bus and taxi drivers, school teachers, municipal and panchayat staff, and even lawyers as frontline workers to make them eligible for vaccination even if they are below the requisite 45 years of age.

Phase-I of the National Covid-19 Vaccination Strategy was launched on 16th January 2021, prioritizing vaccination of Health Care Workers (HCWs) and Front Line Workers (FLWs). Phase-II was initiated from 1st March 2021, focusing on the most vulnerable i.e. all people above 45 years of age, accounting for more than 80% of Covid mortality in the country. The private sector was also roped in to augment capacity.

So far, Emergency Use Authorisation has been granted to two indigenously manufactured vaccines (Serum Institute of India and Bharat Biotech), and a third vaccine (Sputnik) that while presently manufactured abroad will eventually be manufactured in India, the GoI said.

The government said that in its Phase-III, the National Vaccine Strategy aims at liberalised vaccine pricing and scaling up of vaccine coverage, the GoI said. This would augment vaccine production as well as availability, incentivising vaccine manufacturers to rapidly ramp up their production as well as attract new vaccine manufacturers, domestic and international. It would also make pricing, procurement, eligibility and administration of vaccines open and flexible, allowing all stakeholders the flexibility to customise to local needs and dynamics, the GoI said.

The main elements of the Phase 3 Strategy of the National Covid-19 Vaccination program that would come in effect from 1st May 2021

(i)      Vaccine manufacturers would supply 50% of their monthly Central Drugs Laboratory (CDL) released doses to Govt. of India and would be free to supply the remaining 50% doses to State Govts. and in the open market (hereinafter referred to as other than Govt. of India channel).

 (ii)    Manufacturers would transparently make an advance declaration of the price for 50% supply that would be available to State Govts. and in the open market, before 1st May 2021. Based on this price, State governments, private hospitals, industrial establishments etc would be able to procure vaccine doses from the manufacturers. Private Hospitals would have to procure their supplies of Covid-19 vaccine exclusively from the 50% supply earmarked for other than Govt. of India channel. Private Vaccination providers shall transparently declare their self-set vaccination price. The eligibility through this channel would be opened up to all adults, i.e. everyone above the age of 18.

(iii)    Vaccination will continue as before in Govt. of India vaccination centres, provided free of cost to the eligible population as defined earlier i.e. Health Care Workers (HCWs), Front Line Workers (FLWs) and all people above 45 years of age.

(iv)    All vaccination (through Govt. of India and Other than Govt. of India channel) would be part of the National Vaccination Programme, and mandated to follow all protocol such as being captured on CoWIN platform, linked to AEFI reporting and all other prescribed norms. Stocks and price per vaccination applicable in all vaccination centres will also have to be reported in real-time.

(v)     The division of vaccine supply 50% to Govt. of India and 50% to other than Govt. of India channel would be applicable uniformly across for all vaccines manufactured in the country. However, the Government of India will allow the imported fully ready to use vaccines to be entirely utilized in the other than Govt. of India channel.

(vi)    Govt. of India, from its share, will allocate vaccines to States/UTs based on the criteria of extent of infection (number of active Covid cases) & performance (speed of administration). Wastage of vaccine will also be considered in this criterion and will affect the criteria negatively. Based on the above criteria, State-wise quota would be decided and communicated to the States adequately in advance.

(vii) The Second dose of all existing priority groups i.e. HCWs, FLWs and population above 45 years, wherever it has become due, would be given priority, for which a specific and focused strategy would be communicated to all stakeholders.

(viii) This policy would come into effect from 1st May 2021 and will be reviewed from time to time.

Feature Photo: ivvndiaz/unsplash

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