FM Nirmala Sitharaman unveils Rs 1,18,390 crorebudget for J&K

Jammu: Union Finance Minister Nirmala Sitharaman on Tuesday unveiled Rs 1,18,390 crore budget for Jammu & Kashmir for the fiscal year 2024-25.
She also announced that the Central Government will now provide for the salary,pension and other costs of Jammu and Kashmir Police for which anallocation of `12,000 crore has been made in the Unionannual budget 2024-25.
She also said that to correct the complex fiscal issues of Jammu and Kashmir, a special central assistance of `17,000 crore has been worked out and in addition, a lump sum special grant of `5,000 crore as additionalcentral assistance is being provided in the current financial year.
Sitharaman said that the GDP for the year 2024-25 has been projected at `2,63,399 crore which shows a growth of 7.5 % over the previous year.
She added that the due to historical challenges in financial management the Jammu and Kashmirhas a legacy of very high fiscal stress.
“This is aggravated by the committed nature of the major expenditures not supported by proportionate increase in its revenues. Its dependence on central grant is to the tune of around 70% of its total expenditure,” she said adding that the perpetual fiscal stress leads to frequent use of ways and means advances and overdraft.
Finance Minister said that this year the Government of India decided to correct this historical aberration by providing adequate financial support to Jammu and Kashmir coupled with reforms to come out of the perpetual fiscal stress.
“I am happy to mention here that to correct the complex fiscal issues of Jammu and Kashmir, a special central assistance of `17,000 crore has been worked out,” she added.
“It is observed that around 11% of budget of Jammu and Kashmir is used for Police. Such expenses on policing being unavoidable, leaves limited space for spending on development and welfare projects. I am happy to inform this House that the Union Government has agreed to take the entire burden of budget of police from Union Territory of Jammu and Kashmir. The Central Government will now provide for the salary, pension and other costs of Jammu and Kashmir Police for which an allocation of `12,000 crore has been made in the annual budget,” she announced.
She further said a lump sum special grant of `5,000 crore as additional central assistance is being provided in the current financial year.
“As a result of this `17,000 crore of central assistance, the fiscal deficit to GDP ratio will be 3.0% in the FY 2024-25 well within the target. This unprecedented assistance would lead to complete improvement in fiscal position enabling the Government of Jammu and Kashmir to correct the legacy of financial challenges and work towards fulfilling the developmental needs and aspirations of the people, while maintaining stable fiscal health,” she said.
She added that the complete turnaround of Jammu and Kashmir Bank post 2019 is a success story.
She added that Union Territory has witnessed profound ameliorative, affirmative and progressive changes in the last five years.
“The Government of Jammu and Kashmir is working on the mantra of “Reform, Perform and Transform”. This has led to several path-breaking initiatives to unlock economic and industrial potential, improve quality of life, promote social and financial inclusion, fortify law and order machinery, decentralize governance systems, improve efficiency and transparency of public expenditure, upscale revenue generation, minimize wasteful expenditure, and step up infrastructure development,” she said.

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