Manipur Budget, 2020-21 & 12 emerging challenges

Professor N Mohendro Singh *

First of all, we have to know where we are at this age of cut-throat competition.

Manipur, even after 68 years of planning and development in the country, is in Pre-Industrial stage of traditional society conspicuously marked by small and marginal farmers (89% of agri-households), 20,719 Micro-Enterprises, 3,223 Small Industrial Units and 2,29,838 Household Establishments operating in unorganised sector.

Large scale production with economies of scale has yet to pick up possibly with the help of 46 Medium Industries. The factor-driven activities, - not efficiency and innovation-driven activities, remain hallmarks of Manipur.

How can you develop your economy when you are unable to manage even the agricultural sector? Remember we are managing the small open economy without a single Wholesale Market.

The Rural Periodical Markets (119) are backbone of commercial transactions while Tripura is privileged with multiplying advantages of 21 Wholesale Markets and Nagaland 19. Assam has gone far ahead with 226 Wholesale Markets with all encouraging advantages of forward and backward linkages.

It may be recalled that any meaningful budget which we call Master Document of Financial Commitment, should have clear Vision indicating (A) Objectives, (B) Priority and (C) Direction.

It should be a powerful document prepared on the basis of a number of Optimization Exercises, Evaluation Reports, Analysis of Critical Gaps, Resource Plan and Reform Plan. It should also have a positive reference to the Industrial Policy, Agricultural Policy, Health Policy, Education Policy and Environmental Policy. And above all the budget should aim at activating Idle Resources.

Budget allocation has been made fairly well. A provision of Rs. 2,252 crore for Human Resources is good. The Department of Medical Health and Family Welfare is getting Rs. 846 crore while Rs. 1,017 crore has been earmarked for Drinking Water and Sanitation.

In a state like Manipur, Farm Sector should receive topmost priority to ensure economic self-sufficiency and stabilize the growing stages of development. Doubling Agricultural Household Income from the present level of Rs. 9,861/month to Rs. 19,722 in five years needs door-step delivery of package of inputs particularly sufficient water and adequate seeds.

As such, budgetary allocation of Rs. 388 crore is not sufficient. Of course we can expect more contributions from Irrigation for which Rs 503 crore has been earmarked.

Manipur has been ranked 32 in the Ease of Doing Business (Department of Industry Policy and Promotion, GOI). The negligible Business Reform Action Plan and the hostile investment atmosphere explain the deplorable industrial performance in the state. In fact we are going by the same beaten track. Industry gets only Rs. 186 crore while the state needs massive industrial infrastructure.

Rural development is lucky with Rs.1,869 crore. This is good. Because Manipur lives in the villages. There is need for more investment in physical connectivity. Budgetary outlay of Rs. 895 crore may not be sufficient in view of huge supply bottlenecks and cost escalation.

When the whole world is fully prepared to tackle the Climate Change Challenge (CCC), the outlay of Rs.491 crore for Forest and Environment needs to be substantially increased.

The most important part of the budget is State Share Corpus of Rs.200 crore for State Matching Share. It has, in fact, multiplier effect. This is commendable. We can think of increasing the Corpus in response to increasing number of central schemes and changing funding pattern. The central government is fully aware of the weak fiscal position of states like Manipur.

Looked at from these perspectives, Manipur Budget 2020-21 is a nice one. It marks a new beginning to achieve the objectives of “Manipur Vision, 2030 – Leaving No-One Behind” by spending Rs. 21,224 crore.

However, reference to the following emerging challenges could have been a new source of realistic inputs for a pragmatic intervention and long-term development.

1. Structural Stagnation,
2. Acute Professional Backwardness,
3. Rising Economic Insecurity of 40 % of population,
4. Mounting Educated Unemployment,
5. Terribly Strained and Stressed Land Market,v 6. Imminent Water Crisis,
7. Flight of Human Capital,
8. Rising Trend of Drug Dynamism, the offshoot of Indo-Myanmar Border Trade Agreement,
9. Creeping Militant Conservatism, the hybrid of commercial rivalry and ethnic conflict,
10. Disabilities of Unabated Cost Escalation
11. Lack of Co-ordinated Institutional Parenting and
12. Dearth of Good Governance

The presentation of OUTCOME BUDGET along with Outlay Budget could be a lively directional departure in view of limited resources. It could be a better filter for checking leakages and also a source of inspiration for competitive performance. In fact, Manipur needs a WAKE-UP CALL at this stage of crucial transition.

Now, I think Development Partnership could be better option in view of Critical Gaps suffered by the state.