Bihar Budget 2022: Government likely to prioritise infrastructure and job creation

The Bihar Budget, 2022-23, is scheduled to be announced on February 28. It is expected to concentrate more on infrastructure, jobs generation, and incentives for entrepreneurs, for driving growth, post two years of the pandemic-induced economic slump, the officials familiar with the topic said.

The state government has received a guarantee of up to Rs 10000 crores in interest-free loans under the capital expenditure (CAPEX) fund of Rs 1 lakh crore for states in the Union Budget for infrastructure.

On anonymity, an official said, "Bihar is eligible for 10% of the total sum in interest-free loans. In that manner, it can borrow up to Rs 10000 crores and repay it over the next 50 years. This fund will be used for capital investment, with the possibility of new state plans for roads, power, village development, and so on." 

The government will soon send the proposals for the infrastructure-related plans to utilise the fund. The payments are expected to start in May or June, said the second official. 

Under the fund, Bihar received loans from the Centre totalling Rs 843 crores in 2020-21 and Rs 1246 crores in 2021-22.

The officials indicated that the Budget might include major announcements about job creation in the private and public sectors to help drive growth. The opposition Rashtriya Janata Dal criticised the administration for failing to deliver on its election pledge to create 1.9 million jobs.

The state government has accelerated the hiring of 42000 teachers. It is possible to open applications for vacancies in health, commercial taxes, and other departments. 

The state's Budget's outlay is expected to be around Rs 2.25 lakh crore, rising by around Rs 7000 crores. Officials stated the government is optimistic about higher central devolutions and better internal revenue, but it is keen on keeping the Budget size realistic.

The Comptroller and Auditor General of India have stated that the government created unrealistic budgets by spending far less than the total outlays. In 2020-21, the government spent only Rs 1.66 lakh crore instead of Rs 2.11 lakh crore. Expenditure in the current fiscal year is estimated to be Rs 2 lakh crore, compared to the Budget allocation of Rs 2.18 lakh crore.

It is anticipated that the government will announce more incentives for entrepreneurs under Mukhya Mantri Udyami Yojana to generate jobs. 

Centre for Economic Policy and Public Finance assistant professor Bakshi Amit Sinha said, "There is an assumption that the state facing challenges of providing jobs to migrants having returned home and generating employment will focus on entrepreneurship as a medium to tackle unemployment." 

Sinha said, despite the economic downturn, the 2.5 per cent growth in state GDP in 2021 represented a sustainable growth trajectory. According to Sinha, the administration will likely prioritise capital investment and fill vacancies in the health sector and rural infrastructure. He added that the higher public investment would give impetus to the economy for higher growth.

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