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MP ponders hike in taxes, cut in spending to stay afloat

Madhya Pradesh Chief Minister Digvijay Singh has indicated that the state government was contemplating an increase in taxes and cut in expenditure to tide over the current financial crisis.

He said in Indore on Thursday that the fall in revenue collection along with the financial burden of implementing the Fifth Pay Commission had adversely affected the fiscal health of the state. "The cut-down on aid of around Rs 5.5 billion by the Centre had further compounded the problem,'' he added.

Asked whether the state government was planning to reconsider the schemes pertaining to free supply of electricity, Singh said an Electricity Regulation Authority had been constituted to fix the tariff of electricity to be supplied to the consumers. The authority will spell out its views for all categories of consumers but it was for the state government to decide on the amount of subsidy to be given from its budget, he said.

Asked if it was a wise decision to continue supplying free electricity to farmers considering the present financial position of the state, Singh said an ultimate decision would be taken only after evaluating all resources. ''However, something has to be done for the weaker sections of society,'' he added.

On the possibility of reversing the supply of free electricity from five horse power pumps to three or two, he said the state government had not yet deliberated on it but was likely to think in this direction.

When questioned about the possibility of privatising the state road transport corporation, he said that though no final decision had been taken, he personally felt the issue of privatisation should be considered.

UNI

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Madhya Pradesh