Towards Manipur Budget 2022-23 for a Surging state
Time to change both System and Gear

Mohendro Nandeibam *

Now-a-days the distinction between developed and underdeveloped economies is made with reference to the degree of care with which the resources are used. In underdeveloped economy resources are carelessly used and wrong allocation of resources leads to wastages of scarce resources which have opportunity cost.

The right application of public money to right portfolios ensures not only fuller realisation of value of resources but also saves time and energy and paves way to a sound beginning of growth, prosperity, peace and stability.

To-day budget, the “Master Document” of financial resources of particular year, has to go far beyond traditional boundaries of income and expenditure. Budget should reflect the standard of governance, policy changes and the degree of commitment to competitive development. Budget should be designed to put the economy in the right direction. Wrong allocation marks the beginning of the end.

While good economic governance is the touchstone of modern development, the 23rd position of Manipur in the National ranking needs a critical analysis. We have to be fully conscious of high cost of failure. We have to tighten the belt.

Manipur has been struggling hard to get out of the tantalyzing environment largely created by lopsided process and practice of economic activities. Now budget has to play a very powerful role in activating idle resources, stimulating growth impulses and indicating the right direction.

Budget should not be prepared out of thin air. It has to be prepared based on Evaluation Reports, Efficacies of Industrial Policy, Agricultural Policy, Tourism Policy, Trade Policy and State Policy on Act East Policy of India keeping in view Manipur Vision 2030 and Sustainable Development Goals (17).

Poor documentation, unrealistic proposals and wrong allocation lead to sub-optimal allocation among various departmental needs with cascading effect on the general performance of the economy. Right decision and strong determination should go together to break all speed-breakers for a surging State. Budget oblivious of emerging issues may obliterate the critical impulses with dismal future.

Right now Manipur is a land of classic example of family farms, micro-enterprises and household business. Although Service Sector accounts for about 60% of Gross Domestic Product, the performance is extremely low with annual average growth rate of 5.85% only as against 10.3% of Tripura and 8.9% of Meghalaya (GOI: Economic Survey, 2020-21, Vol.2). According to NITI Aayog’s Sustainable Development Index, Manipur is lowest in decent work and growth (Goal-8).

Interestingly we are running the farm sector with 119 Rural Periodical Markets without a single Wholesale Market as against 226 wholesale markets of Assam, 21 of Tripura and 19 of Nagaland (NEDFI). Kitchen gardens cannot bring about Agricultural Revolution. In the meantime one finds uneasy phenomenon of transferring agricultural land for non-agricultural purposes.

It is therefore not a surprise that the Per Capita Income of Manipur is only Rs 75,226 as against Rs 4,30,081 of Goa, Rs 3,80,926 of Sikkim and Rs 1,83,108 of Himachal Pradesh, - which means economic weakness of the State.

Here is a lesson from Chinese development experience. During 1980s, the strategy for take-off consisted of pledge to local Government, pledge to private enterprises and pledge to rural farmers to enable rural masses to avail of distributive justice--- thereby strengthening the rural sector.

Manipur Budget 2022-23 would, perhaps, become enriched and meaningful with the elaborate and convincing answers to four questions such as WHERE do we stand now, WHERE to go, HOW to go and HOW soon. Otherwise the so-called conventional practice of incremental budgeting could at best be continuity without change. Why should we go by the beaten track in this age of aggressive competition ? Remember we are in the age which respects strength only.

Reform Plan and Resource Plan should go together and constitute the backbone of Performance Budget. Manipur needs a lot of reformation. According to Department for Promotion of Industry and Internal Trade, Govt. of India, reformation of Manipur is only 1.60% as against 84% of Assam and 22% of Tripura. Manipur has been categorised as ‘slow burner’, while Assam as ‘role model’ and Tripura as ‘mover’.

The low Ease-of-Doing-Business is a serious challenge. Manipur Budget 2022-23 should address the deep concerns of Insecurity of Business, Insecurity of Employment, Insecurity of Income and Insecurity of Institutional Parenting. Change the gear of administration to give a wake-up call for directional departure. It is too early for us to expect large scale investment from our own sources.

We have to attract private investment. Private investment can help the State in three ways;
(a) it reduces the burden on State exchequer,
(b) it enriches the discipline of courtesy, care and convenience and
(c) it stimulates competitiveness through larger market interaction and innovative approach.

We cannot safeguard our economy with muscle power. It is possible only with pragmatic policies and good governance.

Now can we hopefully expect five (5) takeaways from Manipur Budget 2022-23 ?

1. Creation of world class physical connectivity by increasing capital expenditure to tackle the deep-seated problem of cost-disabilities and limited market interaction,
2. Productivity Revolution of small farms and industrial enterprises with global vision,
3. Big Push to Human Capital Formation to participate in global competition with courage of conviction,
4. State Job Plan to address the mounting problem of educated unemployment,
5. Special Economic Zone at Moreh as springboard of commercial hub and economic corridor, – not as transit yard.

The presentation of Outcome Budget along with Outlay Budget as a beginning of creative fiscal discipline of lasting significance may go a long way in enriching the quality of development of Manipur. Change comes from exceptional leadership. We need a tough stand for a turning point.

* Mohendro Nandeibam wrote this article for The Sangai Express
The writer is a Former Professor of Economics, MU, the writer is Chairman of Institute of Development Studies
He can be contacted at profnmsingh(AT)gmail(DOT)com
This article was webcasted on June 11 2022.

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