A budget with a vision and direction; The Times of India, February 2, 2018

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By Dr Martin Patrick| The Times of India | February 2, 2018

The budget has a vision and direction and is a perfect blend of welfare and development. It has tried to identify the crucial problems of Kerala and attempted to intervene. For example, the Rs 2,000 crore set aside for coastal areas, prompted by the Ockhi cyclone, is a good allocation. However, there should have been some thrust on coastal infrastructure – the budget should have talked about blue economy and should have attempted to develop coastal towns.
Another positive aspect is the focus on women’s safety and gender budgeting – the outlay of Rs 1,267 crore for women is impressive. It also allocated Rs 10 crore for the transgender community and has given attention to inter-state migrants.
The budget relies heavily on KIIFB, which lies outside the budget. If KIIFB is successful, all the related projects will also become fruitful. Sustainability and success of KIIFB depends on many factors and the budget rides on the belief that KIIFB could successfully raise funds. However, there is question on whether KIIFB might be able to repay the principal at an interest rate of 9%.
KIIFB is an innovative solution. When you are in a constrained situation, you have to look for alternative solutions. When there was a decline in taxes revenues, the state’s resource mobilization was constrained and that is why the KIIFB route was explored.
The budget has not brought any cheers to those in the tourism industry. Also, there is no attempt to revive the state’s stagnant construction sector.

The FM depends on KIIFB to rescue KSRTC, but what impressed me was the decision to reconstitute the top management which is largely constituted by trade union leaders. In fact, redtapism and corruption had pushed the corporation into the current situation. The minister also looks at the possibility of clearing the pension arrears through alternative routes. There are perhaps other routes to rescue KSRTC – like leasing to others or running it in a PPP model, which is successful in many countries.

The current problem faced by the Kerala economy is the state’s GDP growth. This year it has gone below the national average. That is one problem the budget had to address.
The planned thrust on knowledge-based industries (electronics hardware, vegetable cultivation, tourism, etc.) will not be enough to help GDP growth. Though there is an emphasis on bio-organic cultivation, the budget should have also focused on ‘agripreneurs’, a segment we have neglected.
This news was published in The Times of India on February 2, 2018; Click here to read: A budget with a vision and direction
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