Fiscal reforms in Odisha on right track: IMF

Bhubaneswar: Fiscal reforms in Odisha is at cutting edge and on the right path with sensible approaches, opined the International Monetary Fund (IMF) team led by Anne Marie Gulde, Dy Director Asia-Pacific Department.

They said this in a high-level meeting on the Public Finance Management (PFM) system held under the chairmanship of Chief Secretary Asit Tripathy at Lokseba Bhawan conference hall here on Monday.

Looking into the progress already made in this direction, Gulde said, “Odisha has shown great interest and progress in improving PFM. It is one of the most active states in India. We are impressed by the level of political will, technical preparedness, administrative commitment and the degree of progress that have already been made. We will continue our joint effort with Odisha in the coming two years for full achievement of the targets”.

The fiscal reform issues relating to the implementation of strategic fiscal planning, strategic budget making, preparation of fiscal strategy paper, Odisha Fiscal Responsibility and Budget Management Act, fiscal risk management, cash management, commitment management and control ( CMC) system,  common treasury management and e-procurement, etc were deliberated in the meeting.

Sukhwinder Singh, Director South-Asia Training and Technical Assistance Center said, “Odisha is first Indian State to have introduced strategic budget making and commitment control system”.

He added the success of Odisha could be showcased as a model for emulation by the other Indian States. 

Odisha Finance Secretary AK Meena said that under this new system, the finance department would communicate the advance tentative ceiling and the departments would prepare the detailed budget as per their priority keeping in view need of the people and commitment of the State.

Chief Secretary Tripathy directed the departments to reap the full potential of the new system and maximize outcomes of the budget utilization.

 The fiscal indicators of Odisha were reviewed in the meeting.

 Meena appraised that State Budget size increased from Rs 18,516.52  crore in 2001-02  to Rs 1.39,000 crore in 2019-20 thereby recording a growth of more than 18 times. 

Odisha is now a revenue surplus state and the fiscal reforms in Odisha are on right track. Overcoming the revenue deficit situation of 5.48% of GSDP in 2001-02, the State has reached a revenue surplus of 2.17% in 2018-19, he added.

The debt stock has decreased from 46.48% of GSDP in 2001-02 to 19.7% of GSDP in 2019-20.  The fiscal deficit has been reduced from 7.68% to 3.49% during the period. The capital outlay for the infrastructural sector has increased from 1.72% of GSDP in the year 2001-02 to 4.53% in the year 2019-20.

 It was decided in the meeting that Odisha would continue to work with IMF’s South Asia Training and Technical Assistance Center (SATTAC), New Delhi in the areas of further improving fiscal management and resource augmentation in the State.

It may be pertinent here to mention that SATTAC provides a world-class capacity development facility to Bangladesh, Bhutan, Maldives, India, Nepal, and Sri Lanka. Apart from capacity enhancement, the center provides technical assistance support to few States including Odisha.