Ongoing clash makes a huge dent on economy
Impact likely to be felt for long
Source: The Sangai Express
Imphal, December 01 2023:
Even as the current conflict between the Meiteis and Kukis has adversely affected Manipur's economy, the crisis could as well hit all sectors and developmental works already sanctioned in the 2023-2024 Budget.
Highly placed sources in the Finance Department said the conflict since May 3 has made a huge dent on the State's revenue.
Since the conflict has adversely affected the State's revenue collection, it is highly likely that this would also challenge the Government in realising the provisions/works mentioned in the 2023-24 Budget.
The State has lost huge revenues in the month of September alone.
October month which saw lesser violence witnessed notable improvement in the revenue collection.
However, the present projectile indicates a fall in November.
The Finance Department will conduct the next assessment in the month of December, said the sources.
The State's revenue collection and the overall economy have been affected due to declining trade and business activities.
The main sources of income of the State are Goods and Services Tax (GST) and Value Added Tax (VAT) .
The sale of petrol and diesel has declined amid the conflict and as a result the State's VAT collection has also drastically declined.
When compared with previous year, the sale of petrol and diesel during November has declined by 50 percent.
Petrol and diesel sales were nil during the early months of the conflict, said the sources.
Notably, many retail outlets/petrol pumps have reported losses amid the conflict.
The conflict has hit import and export of goods, normal trade and businesses and many people have lost livelihoods.
These conditions have a direct impact on the economy.
GST collection has also severely declined, said the sources.
On the other hand, huge expenditures are being made from the State exchequer to provide relief and assistance to victims of the conflict.
The Government is also spending a huge amount of money on security forces and their operations amid the conflict, said the sources in the Finance Department.
Meanwhile, the December assessment of the state of revenue collection will help understand and predict the future of the economy during the 2023-24 year.
The Finance Department has received some data and ground reports for December assessment.
The Department will receive the complete report at the end of November.
The data at present is not sufficient to make a clear assessment, but it is highly likely that the State's revenue and economy will have an impact on realising the provisions of the 2023-24 Budget, said the sources.