Foreword

List of Abbreviations

Chapter I: Overview

1. Introduction

2. Preview

Chapter II: Issues and Perspectives

1. Introduction

2. Central Assistance to State Plans

3. Centrally Sponsored Schemes

4. Surplus cash balances of the state governments

5. National Small Savings Fund

6. Public Distribution System

7. Debt Sustainability

8. Going Beyond the Conventional Debt Sustainability Analysis

9. Goods and Services Tax

10. Conclusion

Chapter III: Policy Initiatives

1. Introduction

2. State Governments

3. Government of India

4. Reserve Bank of India

5. Conclusion

Chapter IV: Fiscal Position of State Governments

1. Introduction

2. Accounts: 2011-12

3. Revised Estimates: 2012-13

4. Budget Estimates: 2013-14

5. Decomposition and Financing of Gross Fiscal Deficit

6. Conclusion

Chapter V: Outstanding Liabilities, Market Borrowings and Contingent Liabilities of State Governments

1. Introduction

2. Outstanding Liabilities

3. State-wise Debt Position

4. Market Borrowings

5. Loans from the Centre

6. Contingent Liabilities

7. Liquidity Position and Cash Management

8. Investment of Cash Balances

9. Debt Consolidation and Relief Facility

10 Conclusion

Chapter VI: Cyclicality in the Fiscal Expenditures of Major States in India

1. Introduction

2. Cyclicality in Fiscal Policy: A Review of Literature

3. Institutional Framework for State Government Expenditure

4. Measuring the Cyclicality of Fiscal Expenditures of Indian States

5. Conclusion

Annex 1: Issues relating to GST and Recommendations of the Standing Committee
on Finance

References

Explanatory Note on Data Sources and Methodology

LIST OF BOXES

III.1 Report of the Committee for Evolving a Composite Development Index of States

III.2 National Food Security Act 2013 - Role of the State Governments

V.1 Committee on Guarantee Redemption Fund

VI.1 Cyclicality of Social Sector Expenditure: Evidence from Indian States

LIST OF TABLES

II.1 Central Plan Assistance to Non-special and Special Category States

II.2 Plan Assistance to States/UTs through CSS

II.3 Number of Centrally Sponsored Schemes

II.4 Central Issue Price

II.5 Debt/GSDP Ratio of Indian States (Average)

II.6 Debt Sustainability Indicators

II.7 Debt Servicing Indicators

II.8 Debt and Accumulated Profit/Loss Position of State PSUs

II.9 Taxes to be Subsumed in the Proposed GST

III.1 Institutional Reforms by the State Governments

III.2a Revenue Deficit Targets (As Percentage of GSDP)

III.2b Revenue Deficit Targets (As Percentage of Total Revenue Receipts)

III.3 Gross Fiscal Deficit Targets (As Percentage of GSDP)

IV.1 Major Deficit Indicators of State Governments

IV.2 Fiscal Imbalances in Non-Special and Special Category States

IV.3A Deficit Indicators of State Governments

IV.3B Deficit Indicators of State Governments

IV.4 Aggregate Receipts of State Governments

IV.5 Expenditure Pattern of State Governments

IV.6 Variation in Major Items

IV.7 Contribution of VAT on Petroleum Products in Total Revenue from VAT

IV.8A Revenue Receipts of State Governments

IV.8B Revenue Receipts of State Governments

IV.9 Cost Recovery of Select Services

IV.10A Revenue Expenditure of the State Governments

IV.10B Revenue Expenditure of the State Governments

IV.11 Interest Payments, Pension and Committed Expenditure

IV.12 Components of Development Expenditure

IV.13A Development Expenditure Select Indicators

IV.13B Development Expenditure Select Indicators

IV.14 Trends in Aggregate Social Sector Expenditure of State Governments

IV.15 Composition of Expenditure on Social Services (Revenue and Capital Accounts)

IV.16 Decomposition and Financing Pattern of Gross Fiscal Deficit

V.1 Outstanding Liabilities of State Governments

V.2 Share in the NSSF collections to be Availed of by States in 2013-14

V.3 Composition of Outstanding Liabilities of State Governments

V.4 State-wise Debt-GSDP Position

V.5 Interest Rate Profile of Outstanding Stock of State Government Securities

V.6 Market Borrowings of State Governments

V.7 Maturity Profile of Outstanding State Government Securities

V.8 State-wise Maturity Profile of Outstanding Government Assistance to States (Back
to Back Loans only) for Externally Aided Projects

V.9 Average Interest Rate on Outstanding Liabilities of State Governments

VI.1 Studies on Cyclicality in Sub-national Fiscal Revenues/Expenditures

VI.2 Results of Panel Unit Root Test

VI.3 Estimation Results for Cyclicality of Government Expenditure in India

LIST OF CHARTS

II.1 Surplus Cash Balances of the States

II.2 NSSF Investment in Special Securities Versus Market Borrowings

IV.1 Value Added Tax in Non-Special and Special Category States

IV.2 Trend in Interest Receipts

IV.3 Composition of Committed Expenditure

V.1 Deficit, Debt and Interest Burden

V.2 Utilisation of WMA and Overdraft by States

V.3 Investments in ATBs and ITBs by the State Governments/UTs

VI.1 Correlation Co-effecient (r) between Cyclical Components of State Fiscal
Expenditures and GSDP (in real terms): 1981-82 to 2011-12

LIST OF APPENDIX TABLES

1 Major Deficit Indicators of State Governments

2 Devolution and Transfer of Resources from the Centre

3 Development and Non-Development Expenditure

4 Development Expenditure - Major Heads

5 Non-Development Expenditure - Major Heads

6 Development and Non-Development Expenditure - Plan and Non-Plan Components

7 Composition of Social Sector Expenditure

8 Decomposition of Gross Fiscal Deficit

9 Financing of Gross Fiscal Deficit

10 Financing of Gross Fiscal Deficit - As Per cent to Total

11 Composition of Outstanding Liabilities of State Governments

12 Composition of Outstanding Liabilities of State Governments - As Proportion to Total

13 State Government Market Borrowings

LIST OF STATEMENTS

1 Major Fiscal Indicators

2 Revenue Deficit/Surplus

3 Gross Fiscal Deficit/Surplus

4 Decomposition of Gross Fiscal Deficit

5 Financing of Gross Fiscal Deficit - 2011-12 (Accounts)

6 Financing of Gross Fiscal Deficit - 2011-12 (Accounts) (As per cent to Total)

7 Financing of Gross Fiscal Deficit- 2012-13 (RE)

8 Financing of Gross Fiscal Deficit- 2012-13 (RE) (As per cent to Total)

9 Financing of Gross Fiscal Deficit - 2013-14 (BE)

10 Financing of Gross Fiscal Deficit- 2013-14 (BE) (As per cent to Total)

11 Development Expenditure

12 Non-Development Expenditure

13 Interest Payments

14 Tax Revenue

15 Non-Tax Revenue

16 Loans from the Centre

17 Devolution and Transfer of Resources from the Centre

18 Composition of Outstanding Liabilities

19 Total Outstanding Liabilities of State Governments

20 Total Outstanding Liabilities - As percentage of GSDP

21 Market Borrowings of State Governments

22 Plan Outlay of State Governments

23 State Government Market Loans

24 Maturity Profile of Outstanding State Government Securities

25 Maturity Profile of Outstanding State Government Securities - As Percentage to Total

26 Availment of WMA and Overdraft from the Reserve Bank

27 Investment Outstanding in Treasury Bills

28 Expenditure on Education - As Ratio to Aggregate Disbursements

29 Expenditure on Medical and Public Health and Family Welfare - As Ratio to
Aggregate Disbursements

30 Outstanding Guarantees of State Governments

31 Expenditure on Wages and Salaries

32 Expenditure on Operations and Maintenance

33 Social Sector Expenditure

34 Social Sector Expenditure to Aggregate Disbursements

APPENDICES

I. Revenue Receipts of States and Union Territories with Legislature

II. Revenue Expenditure of States and Union Territories with Legislature

III. Capital Receipts of States and Union Territories with Legislature

IV. Capital Expenditure of States and Union Territories with Legislature

NOTES TO APPENDICES