With an eye to the panchayat poll due this summer and the Lok Sabha elections next year, the West Bengal government announced a series of fiscal incentives to the rural and social sectors in the State Budget on Wednesday.

Presenting the Budget, Finance Minister Amit Mitra announced an increase in old-age pension to farmers from ?750 to ?1,000 a month. It also provides for ?100-crore corpus fund to assist farmers during bumper crops and falling prices.

"Agriculture land sold for agriculture purposes" has been exempted from payment of mutation fee.

Exemptions for tea industry

The labour-intensive tea industry, which is crucial to win votes in North Bengal districts, has been exempt from payment of education and rural employment cess on green tea leaves. Tea gardens have also been "fully exempt" from payment of agricultural income for two fiscals (FY19 and 20).

However, a large section of the industry being sick, utilisation of the sop will remain low. Mitra felt the exemptions will benefit tea workers.

Focus on social sector

The State’s flagship Kanyashree scheme - for education and prevention of drop-out of the girl child - will see an increase in annual scholarships to ?1,000 from ?750.

Families with an annual income of up to ?1.5 lakh will get ?25,000 cash assistance, under the newly introduced Rupashree scheme, for marrying off their girls.

Persons with more than 40 per cent disability will receive ?1,000 monthly pension.

To boost real estate growth, Mitra announced one percentage point reduction in stamp duty on all properties up to ?1 core in rural and urban areas. With this, stamp duty on properties worth ?40 lakh to ?1 crore will come down to 5 per cent in rural areas and 6 per cent in urban areas.

Fiscal parameters

As a revenue-deficit State, the social sector spending will see fresh piling up of debt. The total outstanding debt will increase by 8.5 per cent from an estimated ?364,019 crore in 2017-18 to ?394,833 crore in FY19.

West Bengal’s debt stock increased by 7.7 per cent, on a lower base, during FY18.

During the current fiscal, public debt shot up by over 77 per cent to ?19,677 crore (?11,096 crore). Market borrowings saw nearly 300 per cent jump to ?11,607 crore (?3,201 crore).

Rising debt stock spree will increase the repayment burden on the exchequer from ?47,272 crore in 2017-18 to ?47,719 crore in the next fiscal.

Mitra, however, contented that unlike during the Left-rule when fresh loans were raised for debt-servicing, 30-40 per cent of current borrowings are used in asset creation.

He also pointed out that the Mamata Banerjee government managed to reduce the debt-GSDP ratio from 40.65 in 2010-11 to 33.72 in 2016-17. The revenue deficit has also come down from ?16,000 crore in FY17 to ?11,005 crore in FY18.

For 2018-19, the State is expecting State GST (SGST) collection of ?13,094 crore, Integrated GST (IGST) of ?9,966 crore and CGST collection of ?15,946 crore.