Maharashtra Finance Minister Jayantrao Rajaram Patil says that the state's revenues are up -- and defends the government's provision of subsidies for sugarcane growers. In the second part of the interview with Renni Abraham, he also speaks about the World Bank report which said that sugarcane farmers get huge subsidies in Maharashtra and that these need to be curtailed.
Have the state's revenue receipts shown a decline?
On the contrary, revenue receipts have exhibited a Rs 700 crore (Rs 7 billion) jump from the last financial year and are at Rs 34,000 crore (Rs 340 billion), up from the Rs 25,000 crore (Rs 250 billion) when our Democratic Front government took charge of the state.
In the next budget these receipts are expected to touch Rs 38,000 crore (Rs 380 billion).
The government introduced the Fiscal Responsibility Bill in the Nagpur session of the state legislature.
The Bill provides for placing certain restrictions upon the spending of the government. Here after, no government will be able to take any decisions that would entail a untenable financial liability upon successive governments.
The Bill introduced in December places restrictions on the government taking decisions that are not really important and which would adversely impact the finances of the state.
There are provisions for transparency in state finances in the Bill. It will relate expenditure to the growth in revenue.
Is it true that the state will be spending more on pensions than on salaries?
It is true. At the current levels of growth in these expenditures, the annual expenditure of the state on pensions is set to overtake the annual salary expenditure by 2008-2009.
To prevent this situation we introduced a new rule last year.
All new entrants to state government service will not be made a part of the existing pension scheme.
They have been inducted into a contributory pension scheme. A committee has been appointed to prepare a report after viewing the Union government's decision on pension that is expected by mid-year.
So, if things go as per planned, from July onwards the new contributory pension scheme will be in place.
A World Bank report has indicated that sugarcane farmers get huge subsidies in Maharashtra and that these need to be curtailed. What is the state doing about this?
Elsewhere in the world sugarcane farmers have huge land holdings. In Maharashtra, however, sugarcane growers are small and marginal farmers.
And these farmers are only given a rebate on their electricity dues. The World Bank claims that only 13 per cent of the farmers own pump sets, resulting in the subsidy being hogged by a small segment of farmers.
This is not true. Moreover, why should our farmers be restricted in their crop patterns? We have to encourage them to go in for cash crops, even though this is water intensive.
Moreover, power tariffs in Maharashtra are higher than in any other state.
In the US, for instance, agriculturists are given a subsidy for not producing crops. In this era of global competition, we need to support and protect our farmers from going out of business.
In Maharashtra we are extending to the farmers what is called a negative subsidy. Even in the case of other states the subsidy is positive.
If you look at the income of farmers in the state, you will realise that they are only just surviving. Their contribution to the gross domestic product (that is, contribution to making one rupee) is more than what they get in return.Powered by 
