Foreword

List of Abbreviations

Chapter I : Overview

1.

Introduction

2.

Preview

Chapter II : Policy Initiatives

1.

Introduction

2.

State Governments

3.

Government of India

4.

Reserve Bank of India

5.

Conclusion

Chapter III: Consolidated Fiscal Position of State Governments

1.

Introduction

2.

Accounts: 2007-08

3.

Revised Estimates: 2008-09

4.

Budget Estimates: 2009-10

5.

Assessment

6.

Conclusion

Chapter IV: State-Wise Analysis of Fiscal Performance

1.

Introduction

2.

Deficit Indicators of the State Governments

3.

Revenue Account of the State Governments

4.

Expenditure Pattern of the State Governments

5.

Conclusion

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

1.

Introduction

2.

Outstanding Liabilities

3.

State-wise Debt Position

4.

5.

Liquidity Position and Cash Management

6.

Contingent Liabilities

7.

Assessment of Debt Position of State Governments

8.

Investment of Cash Balances

9.

Debt Consolidation and Relief

10.

Conclusion

Chapter VI: Expenditure of State Governments : Trend and Composition

1.

Introduction

2.

Overall Trend

3.

Revenue Expenditure

4.

Capital Expenditure

5.

State-wise Analysis of Expenditure

6.

Conclusion

Chapter VII: Issues and Perspectives

1.

Introduction

2.

Revenue Augmentation

3.

Quality of Expenditure

4.

Strengthening of Rule Based Framework

5.

Fiscal Transparency

6.

Surplus Cash Balances

7.

Impact of slowdown on State Finances and Fiscal Stimulus Programmes

8.

Implementation of Sixth Central / State’s Own Pay Commission

ANNEX 1

1.

Major Policy Initiatives of State Budgets 2009-10

Explanatory Note on Data Sources and Methodology

LIST OF BOXES

II.1

Climate Change and Initiatives at the State Level

III.1

Role of Automatic Fiscal Stabilisers at the State level

III.2

Fiscal Stimulus measures at the Sub-National level: A Cross-Country Perspective

III.3

Fiscal Stimulus Measures at State Government Level in India

III.4

Goods and Services Tax in India – The present Status

III.5

Implementation of Sixth Central Pay Commission (CPC)/States' Pay Commissions (SPCs)
Recommendations and State Governments' Finances

IV.1

Fiscal Transparency in the State Budgets

V.1

Surplus Cash Balance of the State Governments: Issues and Challenges

VI.1

Convergence in the composition of Major Categories of Expenditures across States

LIST OF TABLES

II.1

Institutional Reforms by State Governments

III.1

Major Deficit Indicators of State Governments

III.2

Variation in Major Items – 2007-08 (Accounts) over 2007-08 (RE)

III.3

Variation in Major Items – 2008-09 (RE) over 2008-09 (BE)

III.4

Variation in Major Items – 2009-10 (BE) over 2008-09 (RE)

III.5

Aggregate Receipts of State Governments

III.6

Cost Recovery of Select Services

III.7

Expenditure Pattern of State Governments

III.8

Development Expenditure vis-a-vis Total Expenditure

III.9

Trend in Aggregate Social Sector Expenditure of State Governments

III.10

Trend in Composition of Social Sector Expenditure

III.11

Expenditure on Social Services (Revenue and Capital Accounts) - Composition

III.12

Administrative Expenditure of State Governments – Wages and Salaries and
Operations and Maintenance

III.13

Trends in Major Deficit Indicators of State Governments

III.14

State-wise Correction of RD and GFD – 2009-10 (BE) over 2008-09 (RE)

III.15

Decomposition and Financing Pattern of Gross Fiscal Deficit – 2007-08 (Accounts)
to 2009-10 (BE)

III.16

Budgetary Data Variation – State Budgets and Union Budget

III.17

Financing of Gross Fiscal Deficit (GFD) – 2009-10 (Adjusted)

IV.1

Deficit Indicators of State Governments

IV.2

Revenue Receipts of the State Governments

IV.3

Revenue Expenditure of the State Governments

IV.4

Expenditure Pattern of State Governments

V.1

Outstanding Liabilities of State Governments (As at end-March)

V.2

Composition of Outstanding Liabilities of State Governments (As at end-March)

V.3

Debt Indicators of State Governments

V.4

Interest Rate Profile of the Outstanding Stock of State Government Securities (As at end-March)

V.5

Market Borrowings of State Governments

V.6

Weighted Average Yield of State Government Securities

V.7

Normal WMA Limits - 1996 to 2009

V.8

Outstanding Guarantees of State Governments

V.9

Average Interest Rate on Outstanding Liabilities of State Governments

V.10

Maturity Profile of Outstanding State Government Securities (As at end-March 2009)

V.11

Maturity Profile of Outstanding State Loans and Power Bonds (As at end-March 2009)

VI.1

Trend in Expenditure of the State Governments

VI.2

Composition of Aggregate Expenditure of the State Governments

VI.3

Composition of Revenue Expenditure

VI.4

Committed Expenditure and its Composition

VI.5

Trend in Interest Payments of State Governments

VI.6

Composition of Development Expenditure

LIST OF CHARTS

III.1

Major Deficit Indicators

III.2

Cyclical Behaviour of Sales tax/VAT Collections and Nominal GDP

III.3

Cost Recovery of Select Services
(Ratio of Non-Tax Revenue to non-Plan Revenue Expenditure)

III.4

Expenditure on Interest Payments, Pension and Administrative Services

III.5

Major Components of Capital Receipts

III.6

Development and Non-Development Expenditure

III.7

Trend in Social Sector Expenditure

III.8

Trend in Major Deficit Indicators

IV.1

Revenue Deficit (+)/Surplus (-) of non-Special Category States

IV.2

Gross Fiscal Deficit of non-Special Category States

IV.3

Financing of Interest payments by Primary Revenue Surplus in non-Special Category States

IV.4

Revenue Deficit (+)/Surplus (-) of Special Category States

IV.5

Gross Fiscal Deficit of Special Category States

IV.6

Financing of Interest Payments by Primary Revenue Surplus in Special Category States

IV.7

Variation in Own Revenue (OR) and Central Transfers (CT) in 2008-09 (RE)
over 2005-08 (Avg.) - Non-Special Category States

IV.8

Own Tax Revenue of non-Special Category States

IV.9

Own non-Tax Revenue of non-Special Category States

IV.10

Value Added Tax in non-Special Category States during the period (2007-08 to 2009-10)

IV.11

Variation in Development and Non-Development Revenue Expenditure in
2008-09 (RE) over 2005-08 (Avg.) - non-Special Category States

IV.12

Composition of Interest Payments in non-Special Category States - 2008-09 (RE)

IV.13

Pre-emption of Revenue Receipts by Interest Payments and Committed
Expenditure in non-Special Category States - 2008-09 (RE)

IV.14

Variation in Own Revenue (OR) and Central transfers (CT) in 2008-09 (RE) over
2005-08 (Avg.) - Special Category States

IV.15

Own Tax Revenue of Special Category States

IV.16

Own non-Tax Revenue of Special Category States

IV.17

Value Added Tax in Special Category States

IV.18

Variation in Development and non-Development Expenditure in 2008-09 (RE)
over 2005-08 (Avg.) - Special Category States

IV.19

Composition of Interest Payments in Special Category States - 2008-09 (RE)

IV.20

Pre-emption of Revenue Receipts by Interest Payments
in Special Category States - 2008-09 (RE)

IV.21

Development Expenditure of non-Special Category States

IV.22

Social Sector Expenditure of non-Special Category States

IV.23

Capital Outlay of non-Special Category States

IV.24

Development Expenditure of Special Category States

IV.25

Social Sector Expenditure of Special Category States

IV.26

Capital outlay of Special Category States

V.1

Deficit, Debt and Interest Burden

V.2

Composition of Outstanding Liabilities of State Governments (As at end-March)

V.3

Debt-GSDP-Non-Special Category States

V.4

Debt-GSDP-Special Category States

V.5

Utilisation of WMA and Overdraft by States

V.6

Investments in 14-day Intermediate and Auction Treasury Bills by State Governments

VI.1

Trends in Aggregate Expenditure by State Governments

VI.2

Composition of Expenditure of State Governments

VI.3

Composition of Revenue Expenditure: Development vis-a-vis Non-Development

VI.4

Share of Social and Economic Services in Total Development Revenue Expenditure

VI.5

Committed Expenditure as percentage of Revenue Expenditure

VI.6

Trend in Composition of Committed Expenditure of State Governments

VI.7

Trend in Interest Payments

VI.8

Composition of Interest Payments

VI.9

Trends in Capital Outlay

VI.10

Share of Capital Outlay in Total Expenditure and Capital Expenditure

VI.11

Share of Development and Non-Development Expenditure

VI.12

Development and Non-Development Expenditure (As percentage of GDP)

VI.13

Share of Social and Economic Services in Development Expenditure

VI.14

Trend in Social Sector Expenditure

VI.15

Size of State Government Expenditure

VI.16

(A) Weighted Coefficient of Variation in Per Capita Capital Outlay across States

VI.16

(B) Weighted Coefficient of Variation in Per Capita Development Expenditure across States

VI.16

(C) Social Sector Expenditure: Weighted Coefficient of Variation across States

VI.16

(D) Weighted Coefficient of Variation in Per Capita Expenditure on Health

VI.16

(E) Weighted Coefficient of Variation in Per Capita Expenditure on Rural Development

VI.16

(F) Weighted Coefficient of Variation in Per Capita Expenditure on Education

LIST OF APPENDIX TABLES

1

Major Deficit Indicators of State Governments

2

Consolidated Budgetary Position at a Glance

3

Revenue Receipts

4

Revenue Expenditure

5

Capital Receipts

6

Capital Disbursements

7

Devolution and Transfer of Resources from the Centre

8

Development and Non-Development Expenditure

9

Development Expenditure - Major Heads

10

Non-Development Expenditure - Major Heads

11

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

12

Development and Non-Development Expenditure - Revenue and Capital Components

13

Plan and Non-Plan Expenditure - Revenue and Capital Components

14

Non-Plan Non-Development Expenditure of States

15

Composition of Social Sector Expenditure

16

Decomposition of Gross Fiscal Deficit

17

Financing of Gross Fiscal Deficit

18

Financing of Gross Fiscal Deficit - As per cent to Total

19

Composition of Outstanding Liabilities of State Governments (As at end-March)

20

Composition of Outstanding Liabilities of State Governments – As proportion to Total
(As at end-March)

21

State Government Market Borrowings

22

Composition of Capital Expenditure of States

23

Major Components of Social Sector Expenditure

LIST OF STATEMENTS

1.

Major Fiscal Indicators

2.

Revenue Deficit/Surplus

3.

Conventional Deficit/Surplus

4.

Gross Fiscal Deficit/Surplus

5.

Decomposition of Gross Fiscal Deficit

6.

Financing of Gross Fiscal Deficit - 2007-08 (Accounts)

7.

Financing of Gross Fiscal Deficit - As per cent to Total - 2007-08 (Accounts)

8.

Financing of Gross Fiscal Deficit - 2008-09 (RE)

9.

Financing of Gross Fiscal Deficit - As per cent to Total - 2008-09 (RE)

10.

Financing of Gross Fiscal Deficit - 2009-10 (BE)

11.

Financing of Gross Fiscal Deficit - As per cent to Total - 2009-10 (BE)

12.

Development Expenditure

13.

Non-Development Expenditure

14.

Plan Expenditure

15.

Non-Plan Expenditure

16.

Non-Plan Non-Development Expenditure

17.

Interest Payments

18.

Tax Revenue

19.

Own Tax Revenue

20.

Non-Tax Revenue

21.

Own Non-Tax Revenue

22.

Share in Central Taxes

23.

Grants from the Centre

24.

Loans from the Centre

25.

Devolution and Transfer of Resources from the Centre

26.

Composition of Outstanding Liabilities (As at end-March 2004 to 2010)

27.

Total Outstanding Liabilities of State Governments (As at end-March)

28.

Total Outstanding Liabilities of State Governments As percentage of GSDP
(As at end-March)

29.

Market Borrowings of State Governments

30.

Plan Outlay of State Governments

31.

Capital Receipts and Capital Expenditure

32.

State Government Market Loans

33.

Outstanding Market Loans of State Governments (As at end-March 2009)

34.

Maturity Profile of Outstanding State Government Securities
(Outstanding as on March 31, 2009)

35.

Maturity Profile of Outstanding State Government Securities -
As Percentage to total (Outstanding as on March 31, 2009)

36.

Select Committed Expenditure of State Governments - As Ratio to States’ Own Revenue

37.

Select Committed Expenditure of State Governments - As Ratio to Revenue Expenditure

38.

Availment of WMA and Overdraft from the Reserve Bank

39.

Ways and Means Advances from the Centre

40.

Investment Outstanding in 14-days Intermediate Treasury Bills (As at end-March)

41.

Expenditure on Education - As Ratio to Aggregate Expenditure

42.

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

43.

Outstanding Guarantees of State Governments (As at end-March)

44.

Expenditure on Wages and Salaries

45.

Expenditure on Operations and Maintenance

46.

Social Sector Expenditure

47.

Social Sector Expenditure to Total Expenditure

48.

Debt/Interest Relief availed by eligible States under DCRF recommended by TFC

49.

State-wise Trend in Total Expenditure

50.

State-wise Trend in Revenue Expenditure

51.

State-wise Trend in Capital Outlay

52.

State-wise Trend in Per-Capita Capital Outlay

53.

State-wise Trend in Development Expenditure

54.

State-wise Trend in Development Expenditure as per cent of Total Expenditure

55.

State-wise Trend in Per Capita Development Expenditure

56.

State-wise Trend in Social Sector Expenditure

57.

State-wise Trend in Per Capita Social Sector Expenditure

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