Towards a modern budget of Manipur
Manipur needs a Custodian of Resources as Finance Minister
When the whole India is talking about a new era of “Ease-of-Living” replacing “Ease-of-Business”, Manipur is, perhaps, confronting the Unease-of-Survival, being caught in the shackles of increasing deprivations and massive insecurity. The state economy looks seized. How long Manipur shall remain semi-stagnant with a huge backlog of open and disguised unemployment and mounting disabilities of sub-standard connectivites. The running phenomenon of JOBLESS GROWTH and GROWTHLESS JOBS is a challenge of BJP government of Manipur. Both market failure and government failure have now to be intelligently tackled.
Look at the miserable fate of 3,30,447 marginal workers (2011) of which 62.39% is female with hand-to-mouth life. Most of them live,— because they do not die, forget the so-called high sounding words of Women Empowerment Programme. Their earning of 183 days a year is too meagre to meet the minimum expenditure on Food, Health and Education. What type of quality of life one can expect from the consumption expenditure of marginal worker restricted to Rs. 200 a day when inflationary pressure keeps rising? The houses they live in are largely “livable” and “dilapidated” with two rooms on an average. The terrible experience of life speaks of the unabated welfare loss and perhaps, a beginning of dehumanisation.
Another challenge threatening Manipur is huge unemployment of more than 8 lakh. It is not merely the question of economic insecurity but largely of adverse impact such as disincentive in investment in schooling, mental distress, delayed family formation and negative manifestation of citizenship. Social indiscipline and organised violence have now become a new hybrid. Manipur is being threatened with demographic disaster. Remember, development is born in the womb of works. While there are many works to be done, there are few jobs —, really curious, a living testimony to the lack of sound manpower planning and strategic intervention.
Even after 67 years of economic planning in the country, Manipur cannot enjoy the planned change in desired direction with a wide range of alternative choice, larger freedom to earn betterment in well being and greater capability which are necessary components of development. Look at abject realities of the sub-standard of living. One thing is increasingly clear that the conventional market- based solution does not work in Manipur, because of multiple disabilities of poor physical infrastructures, lack of right market information, professional deficiency and uncertain law and order.
If we want to know the standard of governance, please look at the quality of budget presented by the Finance Minister who is normally an expert in the field of economic management. In any civilized society, budget means a “lot” – about performances, achievements, targets, weaknesses and direction. In fact, the Finance Minister is the surgeon while the economy is patient. Financial discipline is his life blood. He should be fully aware of the peril and confusion unless it is controlled and productively used.
The intensity of influence of budget depends upon the extent of monetization and commercialisation of the economy. In a world of small men of feudal nature, people hardly feel the impact of budget. The interaction between isolated pockets of people working mostly in informal sector and administration is very limited and largely confined to a few channels of revenue administration and administration of justice. People in this kind of society feel the existence of government only when they are threatened with foreign aggression, natural calamities and unbridled spectre of poverty and deprivation.
Unfortunately, there is a wrong general perception that budget is prerogative of a few bureaucrats of different departments,— not as “Public Property”. The Master Document is seen as a mere act of routine nature, prepared without broad-based-consultation. The stakeholders,— such as entrepreneurs, people, trade unions, civil societies, industrialists, businessmen, banks and academics are rarely consulted in Manipur, while the informed people is bound to be the foundation for better economic performance in the long run. The budget should have a clear vision indicating:- (1) Objectives, (2) Priorities and (3) Direction. We have to state objectives, set priorities and ensure growth. Mere fire fighting is not enough.
It has to be a very ‘powerful document’ prepared on the basis of a number of optimisation exercises, reports of evaluations, analysis of critical options, resource plan and reform-plan etc. It should also take note of efficacies of Industrial Policy, Trade Policy, Agricultural Policy, Land Use Policy, Food Policy, Health Policy, Education Policy and Environmental Policy. In other words, budget should indicate “where we are now”, “where to go” and “how to go”. Mere compilation of accounts of Income and Expenditure can never unleash the productive forces. Budget should be a serious attempt to unfold the truth of terrible realities on the ground and seek to address the inherent Policy-paralysis that produces deleterious impact on the whole economy.
In most developing states we come across “performance-budget” of functional force imposing new compulsions, new adjustments, new formations and new temptations. The budget should also aim at activating idle resources in order to pave a way to perceptible performances, equity and stability.
The hard fact remains visible and fairly convincing that the job of development is too big for Manipur to do alone. Manipur does need large investment from within and outside. Unfortunately the state faces uncommonly high hurdles with very limited resources.
Investment is not merely an act undertaken at a point of time only. It is a continuous process. Based upon changing perceptions and economic considerations the decision also acquires a character of continuity with change. Failure to raise productivity and adequate resources to meet rising investment requirements and revenue expenditure implies failure to run the economy. We have to act on both “Resource-Plan” and “Reform-Plan” with equal attention. Manipur, it appears, has neither “Resource-Plan” nor “Reform Plan” at the moment. This is, perhaps, the weakest area in the economic exercise.
Investment is linked not only with Physical and market connectivity but also with “security connectivity”. The solid foundation of efficient infrastructures enriched with stability and sensitivity is the springboard of spread-effects of commendable economic initiative.
A time has come for the Government of Manipur to pay special attention to: (1) Development partnership (2) More investment (3) Plan for plan implementation (4) Plan for project coordination (5) Professional efficiency (6) Institutional parenting
Now the Government of Manipur, as a bold step, should:
· Broaden the tax base,
· Raise rate of non-tax revenue,
· Plug leakages,
· Improve tax administration,
· Apply financial accountability and enforce financial discipline,
· Make more transparent and target oriented,
· Check ‘March Rush’
· Check erosion on plan money,
· Mobilise institutional finance,
· Invite domestic direct investment,
· Invite Foreign Direct Investment,
· Prepare zero base budget (Outcome budget),
· Initiate Structural Reform
· Prepare Long-term Perspective Fiscal Plan
· Prepare a blue-print of road-map of Manipur to take best advantage of Act East Policy of India.
The State Government should also review, streamline and improve:
*Economic relation between Manipur and Central Ministries
*Economic relation between Manipur and neighbouring states and countries
*Relation between Manipur and national financial institutions
*Relation between Manipur and other funding agencies.
Manipur now needs a Custodian of Resources as Finance Minister.
The writer is currently Expert Member of a national project on Marketing Infrastructures of MSM Industries of North-Eastern States, sponsored by DoNER and administered by NEDFI.