States likely to get 41% of gross budgetary support

States are expected to get more plan allocation next fiscal as the forthcoming Union Budget will step up gross budgetary support to them by three per cent to 41 per cent as part of efforts to boost infrastructure development.

Official sources said the division of allocation between the states and the Centre was likely to be shifted further in favour of the states with the latter getting nearly 41 per cent of GBS from 38 per cent during 2001-02.

Sources said the finance ministry's acceptance of the 10th Five Year Plan approach paper's proposal to allocate Rs 1130 billion as GBS for 2002-03 was also indicative that the Budget for 2002-03 would see a sharp departure from an industry-oriented bias to a development-oriented one.

The change is largely expected since efforts of the government to provide the much needed impetus to the economy by pumping in Rs 36 billion in the central sector has failed to attain desired results.

It is also on this count that the finance ministry is seen to be in agreement with the planners' advice to pump-prime the economy by accelerating growth through reforms at the state level.

Accordingly, Finance Minister Yashwant Sinha is likely to give hefty rise in the allocation for some of the core sectors including power, roads and construction industry, which are seen to be capable of rapidly boosting demand.

Similarly social sectors such as education, food management, irrigation, health and family welfare are also expected to be the priority areas for Sinha in his Budget.

PTI

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