In the season of freebie politics, all fingers crossed over Karnataka's fiscal health

By M.K. Ashoka

Bengaluru, Jun 10 (IANS): The Karnataka Chamber of Commerce and Industry has given a one-week deadline to the Congress government to roll back the electricity price hike. The chamber has warned that if not, all industries will shut down and resort to a protest.

Former chief minister Basavaraj Bommai has raised concerns over the withdrawal of Rs 1,500 crore allocated towards MSP for farmers in the last budget. He also voiced concern over diverting funds allotted to construct 9,556 school buildings across the state. He warned against cutting funds allotted for the free dialysis facility towards one lakh cycles, free chemotherapy treatment for cancer patients.

Doubts are also raised over providing funds to the metro project, suburban projects to ensure the growth of Bengaluru. These developments are taking place in the backdrop of the newly elected Congress government heralding a new era of freebie politics in Karnataka. The state is known for a robust economy and is one among the top revenue generating states.

Karnataka Chief Minister Siddaramaiah has stated that the government will require Rs 59,000 crores annually to implement the five guarantees promised during the election. The financial requirement is Rs 41,000 crore for the remaining months of the current year.

The Directorate of Economics and Statistics has reported in its advance estimates that the state has recorded a growth of 7.9 per cent in 2022-23. It also stated that per capita income in the state has increased from Rs 2.04 lakh to Rs 3.32 lakh. The state has been maintaining the fiscal parameters prescribed in the Karnataka Fiscal Responsibility Act, 2002 except for a few years of Covid-19 pandemic as the state suffered severely due to the pandemic.

The state's economy however bounced back, exhibiting fiscal discipline. Former CM Bommai claimed that he was presenting a revenue surplus budget for 2023-24. However, several questions are now being raised as the state government is all set to incur Rs 59,000 crores annual expenditure on freebies. The Opposition is demanding the implementation of the freebies without any conditions -- in case the Congress government bends then the expenditure will rise to Rs 1 lakh crore.

Minister for Law and Parliamentary Affairs H.K. Patil had stated that the state government would be burdened by the implementation of the five guarantee schemes. However, he maintained that the poor will benefit from the schemes.

The five guarantees cover 10 kilograms of free rice to every individual of a BPL family under the Anna Bhagya scheme; Rs 2,000 per month allowance for a woman head of family under the Gruha Laxmi scheme; Rs 3,000 allowance for unemployed graduates and Rs 1,500 for unemployed diploma holders for two years under the Yuva Nidhi scheme; free bus travel for women; 200 units of free electricity under the Gruha Jyothi scheme and are going to cost Rs 55,000 crore to Rs 60,000 crore with conditions.

These are going to cost Rs 1.03 lakh crore if given without conditions, say sources in the finance department.

If the government wants to implement freebies with conditions it's going to cost one third of the budget. Sources in the finance department explained that it is impossible in the present circumstances to fulfil the obligations without going for loans. The state has Rs 5.64 lakh crore as loan obligation.

Darshan Jain, joint secretary of the AAP Karnataka unit, told IANS that the freebies provided by the Congress government are cheap copies of AAP. "The design of the presentation was copied and the Congress party had hijacked the designer of our party. The Congress is creating confusion with the free guarantee schemes. There was no homework done and there was no clarity. Karnataka has the capacity to generate funds for freebies. But the Congress is not able to implement the schemes to maintain fiscal health."

There are no steps being taken to contain corruption and unnecessary expenditure. The Congress government is not able to move ahead in this direction, Darshan Jain charged.

In Delhi, the free power scheme is very simple. If you don't use 200 units, you won't get bills. In Karnataka, the simple thing has been complicated with many conditions, according to Jain.

Speaking about the Delhi model, Jain said the Arvind Kejriwal government has been successful in plugging leakages from government expenditure. There are no cuts or commissions received by the government. The projects are implemented with minimum costs. The Congress in Karnataka has not initiated any such steps, Jain maintained.

Social welfare schemes by any party should be welcomed. At the same time, to provide funds for them, unwanted schemes must be stopped. In Delhi, budget outcomes are seen and reviewed on five years' average and a decision is taken to continue or discontinue based on the results.

Karnataka can beat Kerala and 10 per cent of the income of the state could be generated in the state. It can be made a tourism hub. Yadgir, one of the most backward districts, has historical significance but no thought has been given to this, Jain said.

Karunakar Kasale, BJP media cell in-charge in Karnataka, speaking to IANS stated that the Congress party's intentions are clear as they have not kept their word on implementing freebies. They have come out with conditions and excluded the taxpayers. The freebies will hurt the economy and the state will become bankrupt.

There is ambiguity on the number of beneficiaries and other details. The Congress will not give freebies for a year, the promises were made only keeping the BBMP and Lok Sabha elections in mind, he said.

Siddaramaiah, who holds the record of presenting the state budget 13 times, had said that the budget size of Karnataka is Rs 3.9 lakh crore and mobilizing the funds is not going to be a difficult task. "I have presented seven budgets. I am very much aware of finances," he said. "When we are spending Rs 56,000 crore as interest every year, can't we spend Rs 50,000 crore on our people?" he asked.



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Comment on this article

  • manohar, MANGALORE

    Sun, Jun 11 2023

    Rob Peter to pay Paul. This is the strategy of state government. Good luck Peter.

    DisAgree Agree [1] Reply Report Abuse

  • Vinay Pai, Manglore

    Sun, Jun 11 2023

    Isn't this because of previous bjp government, who handled states economy despite Corona? Congress came to power just few years back.

    DisAgree [5] Agree [3] Reply Report Abuse

  • Rohan, Mangalore

    Sat, Jun 10 2023

    No state has become bankrupt in india s history and karnataka is one of the highest gdp and GST contributing states so no need to worry about things that dont matter. What is of the people given back to them. Major tax paying is these simple people taxes for even small things like eateries etc

    DisAgree [12] Agree [5] Reply Report Abuse

  • Rizwan, Dubai/Mangalore

    Sat, Jun 10 2023

    Darshan Jain of AAP has stated that there is no cuts or commission in the freebies provided by Delhi Government. If they are so honest as they claim, then why Satyendra Jain and Sisodia are behind bars ???

    DisAgree [4] Agree [15] Reply Report Abuse

  • KS Mayya, Mangalore/Bangalore

    Sat, Jun 10 2023

    Fingers crossed for what? Would you run the finances of your home like this? If answer is no, then fiscal health will be in the gutter or those who can spend (liquor, real estate & purchase of vehicles) will be subjected to daylight robbery.

    DisAgree [4] Agree [16] Reply Report Abuse

  • David Pais, Mangalore

    Sun, Jun 11 2023

    BJP's have accomplished day & night robbery in their tenure of 3&half years & kept Karnataka's Treasury empty plus highest corruption in their tenure. Bhaktaas are blind.

    DisAgree [7] Agree [2] Reply Report Abuse

  • Anil, Mangalore

    Sun, Jun 11 2023

    All political parties are corrupt , it is just the percentage varies . Sid and DKS are determined to tax the salaried middle class and increase the prices of utilities to meet their freebie plan . The idea was borrowed from AAP only problem is they don't have the intelligence like Kejriwal to pull it off without hurting the innocent tax payers.

    DisAgree [3] Agree [4] Reply Report Abuse

  • David Pais, Mangalore

    Sun, Jun 11 2023

    @anil, da bjp=brhasta jumla paapies is double engine corrupt. aap is also corrupt. da good work is a good work from where ever borrowed, chaiwala never borrow nor do good work, chaiwala empties citizens wallets & emptied India's treasury. bjp's are corrupt day and night.

    DisAgree [6] Agree [3] Report Abuse


    Sat, Jun 10 2023


    DisAgree [15] Agree [5] Reply Report Abuse

  • Vijay Benedict, Mangalore

    Sat, Jun 10 2023

    Please understand no one can give anything free...They will take from one of your pocket and will put in another pocket. When then take, it will be the interest. Just see your revised Electricity Bill.

    DisAgree Agree [18] Reply Report Abuse

  • Ethnic Orchid, Mangalore

    Sat, Jun 10 2023

    Karnataka voters who have voted for this party have been taken for a royal carnival ride. More to come be patient. Sad part is, The villagers n poor people have fallen for this trap

    DisAgree [2] Agree [15] Reply Report Abuse

  • Pacfic Heights, Mangalore

    Sat, Jun 10 2023

    Some of the financial experts expressed there deep concern about these 5 Guartees.If it implemented the status of Karnataka will be Sri Lanka and Pakistan very soon.Therefore peoples of Karnataka want and expect from precent government not to push Karnataka state the most progressive state in India.

    DisAgree [1] Agree [15] Reply Report Abuse

  • real kujuma, kodial

    Sat, Jun 10 2023

    at present there is no better person than Sidda to know the fiscal health as he has presented 13 budgets....he will handle it pefectly..

    DisAgree [42] Agree [17] Reply Report Abuse

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Title: In the season of freebie politics, all fingers crossed over Karnataka's fiscal health

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