___________

Following is Samaja’s article on this.

Pioneer reports on OMFED‘s milk collection and its future plans. Following are some excerpts.

The Orissa Milk Federation (OMFED) established an all-time record on Sunday by collecting 4, 11,237 liters of milk.

This became possible because of the dairy development programme spread over 30 districts of the State.

The district milk federation of Cuttack alone collected 2, 2,564 liters of milk, which is the highest among all the district milk federations in eastern India.

… OMFED plans to collect 10 lakh liters of milk per day by 2012. To build the infrastructure required to collect as much milk, OMFED has already started its work.

It has submitted a plan of Rs 15 crore to the Panchayati Raj department for enlarging the capacity of the existing dairies, building more bulk coolers in the rural areas, pressing into service more tankers for transportation of milk, establishment of new fodder plants and their capacity enhancement.

With the establishment of more fodder plants the producers will be supplied fodders at subsidised rates, which in turn will give a boost to milk production.

Enconomic Times mentions this in another context. Following are some relevant excerpts.

… the US Department of Commerce (USDC) has selected Devi Seafoods, Andhra Pradesh and Falcon Marine, Orissa, as the mandatory respondents on the basis of their export volumes.

These two companies are two of the largest exporters of warm water shrimp accounting for 22% of exports to the US market.

Pragativadi reports on this. Following are some excerpts.

… fisheries and animal resources development minister Golakh Nayak said …, the state would be in a position to export marine products in a large scale to foreign countries.

… he said that the Indian National Centre for Ocean Information Services (INCOIS) will provide the technological assistance to the state government.

The technology would be used by way of implanting satellite radio receivers and Internet facilities in fishing boats and installing electronic display boards at fishing harbours for constant monitoring of vessel movement and fish counting.

The INCOIS is being provided with necessary support by the Space Application Centre, National Remote Sensing Agency, ISRO’s Regional Remote Sensing Service Centre (RSSC) and the Central Fishery Research Institute.

The technology would substantially reduce the search time and human effort in high seas by almost 70 percent, Nayak pointed out.

He said that with the ICT know-how, the marine fishery would use satellite images to identify the prospective areas of fish aggregation.

Later, the information would be given in local language of the respective area thrice a week on Tuesday, Thursday and Saturdays during the fishing season.

At the same time, the information would be communicated to about 225 nodes along the entire coastline through telephone and fax, the minister informed.

It may be mentioned here that the maximum sustainable yield of marine fish in the state stands at 1.61 lakh tonne per annum.

Giving further plan details, the minister said that 20 electronic display boards would be set up at fishing harbours in the first phase for which the state government would bear 20 percent of the cost.

This apart, 10 Potential Fishing Zone (PFZ) Boards would be installed while the ICT kiosks in these centres would be set up by the United Nation’s Development Programme (UNDP), Nayak said.

It may be mentioned here that there are two PFZ boards installed at Nuagolabandha ICT Centre in Ganjam district and Balaramgadi ICT centre in Balasore district.

Deepika Global reports on Paradeep Phosphates’ record production this year. Following are some excerpts.

The Paradeep Phosphate Limited (PPL) has registered a record of 13.18 lakh tonnes production in last fiscal and earned a net profit of Rs 109 crores while raising its income to Rs 2067.2 crore. … of the total production the DAP alone accounted for 8.2 lakh tonnes.

Among the intermediary products, Phosphoric Acid, he said was 2,80,300 tonnes, registering an increase of 8.6 per cent over the previous year.

Similarly, Sulphuric Acid registered an increase of 3.4 per cent in comparison to last year with 7,60,610 tonnes.

He said in addition to 13.10 lakh tonnes production, the PPL also sold 1,42,152 tonnes of imported Mauriate of Potash (MOP), 3,13,470 tonne of Gypsum and exported 31,000 tonne of fertiliser to Nepal.

Mr Nandrudikar claimed that the Navaratna Krushi Vikas Yojana implemented in Orissa and Chhatishgarh had been very successful in increasing the yield with the use of improve techniques of agriculture.

Besides improving the agricultural productivity, the PPL had also undertaken mushroom cultivation and tissue culture of bananas in four districts, two each in Orissa and Chhatisgarh, he added. …

He said the company had already invested Rs 140 crores in first year and another Rs 142 crores last year further adding that it had decided to invest another Rs 140 crore during the current fiscal.

Following is Samaja’s article on this.

Telegraph has a nice article on organic turmeric from Kandhamala and its marketing. Following are some excerpts.

But finally the precious haldi was traced to a small shop at the back of Ekamra Haat, Bhubaneswar’s equivalent of Dilli Haat, showcasing handicrafts and products made by tribals. …

The golden yellow Kandhamal haldi, named after the district where it is produced, is creating ripples in the world of spices. The spice has made its way to shelves across the United States, several countries in Europe, including Germany and Netherlands, besides Japan because of its organic value. It smells just right, lasts longer and only a pinch adds the colour and the flavour to the food. And it is of course devoid of toxic elements and chemicals. …

In the district, about 12,000 hectare is diverted for turmeric cultivation and dry haldi weighing 10,000 metric tonne is produced every year. Kandhamal haldi is famous for its colour, texture, aroma, flavour and long shelf life.

The curcumic content in it is claimed to be the highest in the country, to be recognised soon by the Union Control of Holland, a certifying agency engaged to certify its purity.

The spices are being marketed by Omfed, Aryan International, New Delhi; Samiter India, Mumbai; ABC International, Bangalore and Aricha Trading, Calcutta. But as the experience in Bhubaneswar shows, most of it gets exported. Till 2003, however, traders from Berhampur continued to purchase dry turmeric from tribals for paltry sums.

However, the idea of organised turmeric farming on Kandhamal terrain stuck Omfed. It started a government-sponsored project called Kandhamal Women’s Organic Turmeric project (KWOTP) in 2003. …

But soon, we realised the potential for turmeric plantation. Each family in the district had at least a field where they grew turmeric. We knew that if we could channelise the whole thing, there would be no stopping. Soon, societies were formed, training imparted, improved varieties of seed were supplied and marketing of the product under the brand Kandhamal haldi started.”

Currently Omfed directly supervises 305 all-women societies that work for the project and the production has leaped form 250 quintal to 2,937 quintals in a span of four years. This apart the product is being processed and packaged to be sold though Omfed’s existing distribution channel (marketing outlets and booths) across the state.

This apart, two other units named Samanwita and Kasam, who have their processing plant where the Omfed turmeric is packed and independently marketed.

Samaja has a the following article on farming that can be done after a flooding.

Financial express reports that Orissa growth rate for the current year is better than national growth rate. National Industrial growth rate increased at 6.93% for the 11th plan period while in Orissa the growth rate was 11.34%. Simultaneously, while agricultural growth rate in the National context was 1.03% , in Orissa the growth rate was 3% across the 10th 5 year plan period. The overall growth rate was 7.3% for orissa as opposed to National growth rate of 6.5%. Excerpts from the article are as follows:

‘‘The growth rate of Orissa ws 7.3 % during the 10th plan period against the national average of 6.5%,’’ state finance minister Prafulla Ghadei said while replying to the discussion on Appropriation Bill in the state assembly.

Ghadei said the state was on growth path due to the strict fiscal discipline maintained by the government after Patnaik took over the reigns. ‘‘While the growth rate during the previous Congress regime was below the national average in 9th plan period, it increased in the 10th plan period,’’ he said.

Seeking to justify his argument, the finance minister pointed out that while national growth rate in agriculture was 1.03% during the 10th plan period, it was 3% in Orissa which was higher than many other states in the country.

While the national growth rate in industrial sector was confined to 6.96% in the 10th plan period, it was 11.34 % in Orissa, he said quoting what he claimed data obtained from the national sample survey. ‘‘Isn’t it an achievement of the Orissa government,’’ Ghadei asked the opposition, which earlier described the government as ‘non-performing’’. Referring to poverty, Ghadei said Orissa was ahead of neighbouring states like Jharkhand and Bihar in controlling poverty.”

The above reports prove a point that the state has gone beyond signing MOUs and creation of fruitful economic activity in the state, since that is reflected in the survey results.

We just need fruition of the big ticket investments which will result in even greater growth in the next 5 year plan. A note of caution though, current agricultural productivity is still below National average. A plan needs to be formulated to change the per hectare output in the state.

Statesman reports on this. Following are some excerpts.

Badamba-based Balaji Sugar is all set to start its sugar refinery unit by November this year with an investment of Rs 40 crore. The company has also planned to set up an ethanol plant with a capacity of 40000 litre.

… he said that the company through a special programme would lend soft loans at six per cent interest through banks to farmers as well as fertilizers and supply seeds at subsidized rates to more than 10,000 sugarcane farmers in all command areas of Jajpur, Kendrapara, Jagatsinghpur and undivided Cuttack district.

The company has announced a special plan for the farmers named Swarna Varsha in which farmers can get fabulous prizes against the number of sugarcane trucks they supply.

The new refinery will be of 2000 TCD with 100 per cent EOU (export-oriented unit) which will be manufactured from imported raw sugar from Brazil and Malaysia and will be exported to Bangladesh, Sri Lanka and Pakistan. Besides this, the company is also installing 40,000 litres per day extra neutral alcohol to be used as base product for all the distillery units in Orissa as well as neighbouring states. They are also having the plan to manufacture ethanol keeping in mind the global warming, which is an environment-friendly substitute of petrol, which is 5–10 per cent as per government directives.

On the other hand, the company has decided to set up a 20 MW power plant using crushed cane instead of coal. The factory at Badamba was sold by the state co-operative department with zero liability as well as to select the co-operative staff as per choice and head of the company without any compulsion to recruit them in the management by Balaji Sugar.

Business Standard reports on this. Following are some excerpts.

… When several other tribal families are taking loans from the middlemen to maintain their family, 42-year-old Bati has not approached the landlord for the last three years.

Instead, she is taking a loan of grain from the grain bank in her village with a nominal grain interest to maintain her seven-member family.

“Three years ago, we were forced to borrow from the money lender to maintain our family during the rains. The grain that we used to produce went into paying the money lender,” she said.

… “We have developed our grain bank with contribution from the villagers and with support of South Orissa Voluntary Action (SOVA), one of the leading NGOs in the district,” says Gopa Jani, the president of the village committee of Puki.

For setting up the grain bank, each and every household in the village contributed food grain, including paddy and maize. In addition, SOVA contributed an equal quantity to make it a corpus fund of food grain. The grain was stocked in the traditional way in bamboo baskets to protect from insects and managed by a village committee.

“A borrower has to pay an interest of two kg and one kg for 10 kg of maize and paddy, respectively,” says Jani. The loan is repaid by the borrower after harvesting. Puki village has 69 households with a population of 244, and no one now approaches the money lenders for loans, he said.

“The grain bank helps a lot during the lean period from July to September, when we do not get any work,”…

In his village, with 22 households, mostly Kandha tribals, people borrow grain mostly in the rains.

Since last three years, grain banks have been setup in 18 villages in three panchayats of two blocks including Koraput and Kunduru.

“About 928 households of these villages have benefited from the grain banks,” Sanjeet Patnaik, president, SOVA, said. “We are trying to setup more grain banks in coming years,” he added.

The tribal people in Koraput, generally practice podu (shifting cultivation) and collect minor forest produces. Koraput has about 50 per cent tribal population.

Some of the other topics that were discussed in the assembly include the following:

• Insurance for fishermen
• Monthly electricity generation
• Progress on second Infocity
• Foreign demand for handlooms
• Conservation of ancient documents

Following is Samaja’s report on the above.

New Indian Express reports the Orissa minister’s statement on this regard in the assembly. Following are some excerpts:

Refuting Opposition charges that the State Government has paid no attention to flood control measures, Planning and Coordination Minister Padmanabha Behera said a master plan is being prepared in this regard for Tel river basin.

The State Government has also decided to construct a barrage at Barmul on river Mahanadi as a part of flood control measure. Only seven villages would be submerged because of the project, he said.

He reiterated the State Government’s commitment to irrigate 35 percent agriculture land in all the blocks in the State. … the minister said out of the 314 blocks, 194 blocks have less than 35 percent irrigated agriculture land.

More than 60 percent of these blocks are in KBK and backward areas, … and … steps have been initiated under different programmes to increase the land under irrigation in these blocks.

Stating that the project to link Bansadhara with Rushikulya river would not be economically viable, the Minister said the State Government was contemplating to implement Lower Bansadhara project which can irrigate 31,000 hectares.

… Leader of Opposition J B Patnaik said 40,000 hectare agriculture land can be brought under irrigation if a dam is constructed on the upper basin of Mahendra Tanaya river.

…, JB said 30 lakh acres could be brought under irrigation within the next five years by spending Rs 8,000 crore. He said pani panchayats should be scrapped.

The news report mentions that:

Amit Spinning, which was a leading spinner in the country, has now moved into organic cotton farming with 10,000 acres of farmland under organic cotton in Gujarat and a similar size in Orissa.

Union minister Jairam Ramesh during his visit stressed that Orissa broaden its horizon beyond minerals and metals. Some of his points were sensible and some others politically motivated. In another posting we give a rejoinder to his politically motivated comment on IIT in Orissa. Here we present some of his good ideas excerpted from a Statesman article.

The export of marine products should grow from its present level of Rs 370 crore to Rs 1,000 crore in five years, he said and added that an action plan to this end had been submitted to the state government. The MPEDA has given an action plan and it proposes to focus on shrimp and prawn cultivation over 20,000 hectares along Balasore and Bhadrak districts. Earlier, Mr Ramesh inaugurated the Quality Control Laboratory’ of the Marine Products Export Development Authority (MPEDA) here today. This laboratory is the fourth in its kind in the country.

Organic ginger and turmeric, coffee and other items can be grown in tribal areas of Orissa and “we have a proposal pending since long with the state government for an organic export zone to be set up at Kandhamal district,” he said. Shellac cultivation was another area where Mayurbhanj district of Orissa has been identified as one of the four districts in the country for promotion of shellac cultivation he said.

He also criticizes Orissa’s focus on mines and metal processing industries. Orissa has the mines. What should it do? Hide it? It can’t. The Hoda committee recommends that if states delay in making a recommendation then the central government can make a unilateral recommendation. Now if that happens the minerals may go out of state and the state, which now only gets paltry royalty due to central govt. craziness of having  very low royalty rates, will lose out on development associated with value addition(like making steel). Value addition leads to infrastructure developments such as roads, railways, ports, townships, etc. So unless Orissa pays attention and follows through on its policy of only recommending mines to companies that will do value addition, and helping the companies to do the value addition, it will lose out a lot. So Orissa’s focus on the mines, steel and aluminum is not misplaced. However the point about looking at other sectors is a good one.

Business standard reports that Syndicate Bank and Indian Overseas Bank plan several social schemes involving training villagers. Following are some excerpts from that report.

Syndicate bank said it would take up extension activities in all its rural branches for educating and training villagers in different aspects of agriculture, animal husbandry, plantation and fish rearing.

Indian Overseas Bank (IOB) said it would organise at least three training camps for women in southern Orissa during 2007-08.

“We have decided to organise at least three training camps on tailoring, handicraft and beauty therapy for rural women in southern Orissa towns at Rayagada, Jeypore and Bhawanipatna” …

At Jeypore in Koraput district, the bank has decided to impart training to the Scheduled Caste and Scheduled Tribe women.

In Rayagada, training to be given to the weaker section people.

Similarly in Bhawanipatna, the district headquarters of Kalahandi district, women in general categories will get training.

In each camp, scheduled to start in July or August, at least 20 women would be participated.

The respective branch managers would select the women to get training, he said …

After getting training for a fortnight, they would receive financial assistance from the bank for establishment of units in various fields.

“Our corporate office has agreed for three training camps initially and if more number of women come forward for skill and entrepreneurship development, more number of camps will be organised” …

Syndicate Bank would conduct 58 extension activities during 2007-08.

The bank’s Berhampur branch has recently held a farmers’ meeting on jatropha plantation at Narendrapur in Ganjam district in collaboration with the Orissa Nature Care & Council (ONCC), an organisation imparting training on jatropha cultivation for bio-diesel.

ONCC provided technical know-how and inputs for jatropha planting while the bank was financing farmers, …

Syndicate Bank offered Rs 10,000 to each of the 55 farmers in the village for taking up of jatropha plantation, …

Jatropha cultivation was done in about 105 acres in the village.

Syndicate bank would donate Rs 10,000 each for renovation and cleaning of ponds in 10 villages during the current year.

New Indian Express reports that the central govt. has suggested that Orissa apply for an agricultural export zone. Following are excerpts from that article.

Union Minister of State for Commerce Jairam Ramesh on Tuesday hinted that an Agriculture Export Zone (AEZ) in Orissa could be considered once the proposal for the same was received by the Centre.

Ramesh, who met Chief Minister Naveen Patnaik at the Secretariat, told reporters that the AEZ would be established in Kandhmal for organic turmeric. …

The State Government has already identified land for establishment of the AEZ in Kandhmal where a majority of the tribals cultivate organic turmeric.

Ramesh said that he requested the Chief Minister to concentrate more on export of organic coffee from Koraput, ginger and turmeric from Kandhmal and Sal from Mayurbhanj which could generate more employment opportunities.

The Union Minister said that Orissa exported goods worth Rs 10,400 crore last year, 90 per cent of which accounted for minerals only while the handicraft and other non-traditional products had a very negligible share.

Though Orissa is known for its famous handicraft, the export of such products stood only at 3 to 4 per cent of the total export of the country. Ramesh said the State had exported marine products to the tune of Rs 350 crore last year adding that this has to cross Rs 1000 crore in the next five years.

The Centre, he said, would sanction a cold storage for perishable products in Bhubaneswar and another for marine products in Paradip soon.

Statesman reports on several strategies that were discussed on agriculture and horticulture. Following are some excerpts of that report.

The government has decided to encourage contract farming in cotton and has fixed a target of covering 60,000 hectors under such contract farming during 2007-08. To ensure renumerative price for cotton growers, two additional mandis will be set up in Ganjam and Gajapati districts.

With floriculture having tremendous potential in the state, the government has planned a mandi in Bhubaneswar. Among other proposals discussed today were the steps to encourage organic farming in Phulbani district and aromatic rice in Koraput district. Women Self Help Groups will be encouraged to undertake fishery activities.
Simultaneously, measures to train farmers will be stepped up. Last year, over 23,000 farmers were trained and over the next four years, another 3.32 lakh farmers will be trained, said official sources.

Cashew, mango and banana will be promoted and targets for such plantations were fixed for 2007-08. Primary seed replacement, seed production and other measures in this regard were also discussed.

New Indian Express reports on some of these plans. Following are some excerpts from that report.

The State Government has decided to prepare a five year plan to expand the activities of the Watershed Mission to benefit six lakh landless families.

Official sources said that the activities of the Mission would be intensified in areas inhabited by tribals of the Juang community to create employment opportunities.

Mission activities include digging of ponds to meet the water requirement in the villages and promotion of dairy and horticulture. …

Other projects undertaken under the Mission include the Integrated Watershed Development Project (IWDP), a centrally sponsored programme implemented in 23 districts. The outlay of the project has been fixed at Rs 148.07 crore for 2.78 lakh hectare.

The Drought Prone Area Programme (DPAP), another centrally sponsored scheme is being implemented in eight districts covering 47 identified drought prone blocks.

Sources said that 800 micro watershed projects have already been executed while another 600 are being implemented. The total expenditure has been pegged at Rs 227.4 crore .

Besides, 314 micro watershed projects have been taken up by the Mission in the KBK districts for treatment of 1.67 hectare with an expenditure of Rs 100.57 crore.

Coffee Development Programme (CDP) for small growers has also been taken up under the Mission in Koraput and Rayagada districts.

The programme aims at providing sustainable livelihood to tribal farmers. In the first phase, coffee cultivation was taken up in 2,000 hectares, 1,000 hectares each in the two districts. In the second phase, the programme would be implemented in more than 8,000 hectares with Rs 67.21 crore.

The River Valley Project (RVP) is being implemented in the catchment of inter-state projects, Hirakud, Machhkund- Sileru, Rengali-Mandira and Upper Kolab dam projects to prevent land degradation and prevent silt inflow. The expenditure has been pegged at Rs 4.97 crore.

From the Budget pages http://orissagov.nic.in/finance/BUDGET/budget.htm. The speech, in pdf, is located here. Following is a text version with some possible conversion errors.

Hon’ble Speaker Sir,

At the outset, I express my deep gratitude to you, Leader of this House, Hon’ble Chief Minister, Hon’ble Leader of the Opposition and all Members of this August House for having given me this opportunity to present the full-fledged Budget for the financial year 2007-08.

2. I would like to mention here that instead of full-fledged Budget for2007-08, a Vote on Account Budget for 4 months was presented by me on last 29th March. This Vote on Account Budget was passed by the Legislature. Now a full-fledged Budget for the financial year 2007-08 is presented for approval of this August House.

3. While presenting the Budget for the financial year 2007-08, I deem it proper to highlight some facts on the fiscal situation of the State for information of Hon’ble Members.

4. The State Government have taken many reform measures to correct the fiscal problems of the State. These include expenditure rationalization measures, revenue step-up measures, improvement in delivery system and proper utilization of limited resources etc. Needless to mention that through various additional resource mobilization and expenditure rationalization measures, there has been an improvement in fiscal management and notable results have been achieved. Some examples are as follows:

(i) Revenue deficit has been completely eliminated much before the financial year 2008-09 which was the target set by Medium Term Fiscal Plan.

(ii) While the revenue deficit of the State was Rs.2574.19 Crore in 1999-2000, this deficit was reduced to Rs.522.30 Crore in 2004-05. Our State has become a revenue surplus State from a revenue deficit State for the first time in 2005-06 after a long gap of 22 years. Revenue surplus has been estimated at Rs.1045.76 Crore in 2007-08.

(iii) Another significant aspect of financial management is achieving expected success in resource mobilization. It is to be mentioned here that because of State’s constant efforts, remarkable improvement in State’s own resources has been achieved since 1999-2000. Where as during 1999-2000, State’s own tax and non-tax revenue was Rs.2420.56 Crore, during 2004-05 this has reached Rs.5522.12 Crore and during 2005-06 the achievement was Rs.6534.18 Crore. While State’s own tax and non-tax revenue were estimated at Rs.6452.99 Crore in the original Budget for the year 2006-07, the same has been estimated at Rs.8196.28 Crore in 2007-08.

(iv) Another aspect of sound fiscal management is less dependence on Overdraft and Ways & Means advance from RBI. From 2005-06 onwards the State Government have neither resorted to Overdraft nor Ways & Means advance. This is indicative of the improvement in the financial management of State Government.

(v) 11th Finance Commission recommended that if the gap between State’s Revenue Deficit & Revenue Receipt remains within 5% during 2000-01 to 2004-05, the State Government would be eligible for Fiscal Incentive grant. Since the State Government was able to contain the revenue deficit within the stipulated percentage during the aforesaid period, Rs.315.35 Crore have been received towards Fiscal Incentive grant.

(vi) Similarly, as per recommendations of 12th Finance Commission, State Government have availed Debt Relief of Rs.381.90 Crore for fiscal achievement during 2004-05 and are also likely to get similar Debt Relief during 2006-07 for fiscal achievement during 2005-06.

(vii) On the other hand, whereas during 1999-2000, 79.17% of the net loan was used to meet revenue deficit, the revenue surplus during 2005-06 is Rs.481.19 Crore. Hence, there is no necessity at present to meet revenue deficit out of the loan amount.

(viii) Because of encouraging revenue mobilization efforts, the State Plan outlay has been increased to Rs.5105.00 Crore for the year 2007-08. While in the original Budget for 2006-07, the State Plan was fixed at Rs.3500.00 Crore, it was increased to Rs.3600.00 Crore as per the revised estimate for 2006-07. Compared to last year, the State Plan expenditure has remarkably increased this year, which will accelerate the pace of development of the State.

(ix) Despite success of the State Government in various fields, it is to be admitted that heavy debt burden is another indicator of weak fiscal situation. The State’s debt burden stands at Rs.36459.07 Crore as on 31.3.2006, which is 48.16% of the GSDP. As per the recommendations of the 12th Finance Commission, the Debt-GSDP ratio should be 28%. Similarly, as per the recommendations of the Commission, Interest Payment -Revenue Receipt ratio should be 15%. As against this, the ratio of Interest Payment to Revenue Receipt is 26.2% during 2005-06. I may point out here that it is not at all wrong to incur loan for carrying out developmental activities. But the loan should not be used to meet the Revenue Deficit. As a result of continuous efforts of the State Government, the ratio of Debt to total Revenue Receipt has been reduced from 308% in 1999-2000 to 259% in 2005-06.

(x) The State Government have been able to save Rs.144.47 Crore towards interest payment by swapping high cost loan with low cost loan as per Debt Swap Scheme of Govt. of India.

(xi) In the meantime, the State Government have resorted to Debt Buy-back and made pre-payment of high cost market loan amounting to Rs.394.61 Crore.

5. I would like to inform this August House that previously the Central Assistance to the State Government had the Grant and Loan component in the ratio of 30:70. But as per the recommendation of the 12th Finance Commission, State Government is now arranging the loan portion of the Central Assistance on its own. The system has been made effective from the financial year 2005-06. Moreover, Government of India had fixed the net loan ceiling of Government of Orissa at Rs.1677.00 Crore for the financial year 2006-07. In order to finance the State Plan outlay of Rs.5105 Crore finalised by the Planning Commission for the current financial year, the net loan has been estimated at Rs.1026.29 Crore in the Budget.

6. We shall have to reduce salary expenditure because salary expenditure constitutes 49% of the revenue expenditure net of Interest Payment and Pension. But as per the recommendation of the 12th Finance Commission, the ratio should be within 35%. In order to achieve this target, we shall have to work with patience and commitment. So it is my sincere belief that your unhesitating support, as in the past, will also continue.

7. It is a fact that in a welfare State, provision of expenditure is to be allocated keeping in view the problems of the people. But in the context of limited resources of the State, we shall have to prioritize the expenditure for the development of the State. The crux of the matter is to enhance the Capital Expenditure by curtailing unproductive expenditure, so that there will be space for infrastructure development as well as inflow of private investment.

8. Taking into account the State’s own tax & non-tax revenue, State’s share from central taxes and Grant-in-Aid from the Centre, while State’s total Revenue Receipt during 2007-08 has been estimated at Rs.19467.20 Crore, the Revenue Expenditure has been estimated at Rs.18421.44 Crore. As against the revenue surplus of Rs.481.20 Crore and Rs.747.76 Crore in 2005-06 and 2006-07 (Revised Estimate) respectively, it has been estimated at Rs.1045.76 Crore for 2007-08. On the other hand, in the Capital Account, the estimated expenditure would be more by Rs.1220.43 Crore than the receipt. The expenditure on account of Capital Outlay, disbursement of Loans and repayment of installment of earlier loans taken together would be more than the receipts from the loans and advances from different sources together
with the recovery of loans. In toto, the deficit in the Consolidated Fund has been estimated at Rs.174,67,04,000/-and an equal amount has been estimated as surplus in the Public Account. On the whole, the receipts and expenditure have been balanced taking into account the Revenue Account, Capital Account and Public Account together. Hence this is a Balanced Budget with revenue surplus.

9. I now like to present some of the highlights of the provisions made both under State Plan and Non-Plan sectors in the full fledged Budget for 2007-08.

10. Highlights of the State Plan I now point out the Highlights of State Plan Outlay.

• Ours is an agrarian State. So the popular Government Agriculture under the leadership of Hon’ble Chief Minister, Sri Department Naveen Patnaik, has given importance to enhance income of farmers by increasing production of traditional crop and diversion to high value cash crops, particularly to horticultural crops in high lands. While Rs.1.40 Crore was provided in the Budget for the 2006-07 for development of horticultural activities in 11 Non-Mission Districts, the same has been increased to Rs.3.05 Crore in the Budget for 2007-08.

• While Rs.20 lakh was provided in the original Budget for 2006-07 for Agriculture Promotion and Investment Corporation Limited (APICOL), Rs.50 lakhs has been provided in the Budget of the current year.

• While there was a provision of Rs.1.78 Crore for fertilizer, bio fertilizer, insecticide and bio-insecticide in the original Budget for 2006-07, Rs.5.51 Crore has been provided in the Budget for 2007-08.

• While there was no provision for Micro Irrigation Programme under State Plan Sector of Agriculture Department in the original Budget for 2006-07, Rs.50 lakh has been provided in the Budget for current financial year.

• While Rupees One Thousand was provided in the original Budget for 2006-07 towards subsidy under the new Agriculture Policy, the same has been enhanced to Rs.3 Crore in the Budget for 2007-08.

• For the first time, in order to encourage the cultivation of Potato, Vegetables & Spices, a sum of Rs.1 Crore has been provided in the Budget for 2007-08.

• Cultivators will be given due encouragement with a view to increasing the production of oil seeds like groundnut and cultivation of pulses and maize. Rs.10.49 Crore has been provided in the Budget for the year 2007-08 which includes State Share of Rs.2.72 Crore for providing assistance to this sector.

• You are all aware of the fact that priority is being given to Soil & Water Conservation through Watershed Development Programme by the Government under the leadership of Hon’ble Chief Minister, Sri Naveen Patnaik. The Budget estimate for 2007-08 provides Rs.18.40 Crores under the Work Plan for Macro Management of Agriculture towards development of Watersheds under NWDPRA and River Valley Projects.

• While the original State Plan for 2006-07 under Agriculture Department was Rs.48.08 Crore, it has been increased to Rs.60.65 Crore in 2007-08.

• While Rs.363.00 Crore was provided in the original Budget for the financial year 2006-07 for Accelerated Irrigation Benefit Scheme, the same has been increased to Rs.464.28 Crore in the Budget for the current year.

• A new scheme named “Biju Gram Jyoti” has been prepared in order to provide electricity in villages having population of less than 300 and for this purpose, Rs.50 Crore has been provided in the Budget of Energy Department in the current year.

• The State Government has implemented a new scheme known as Biju K.B.K. Yojana in K.B.K. Districts in 2006-07 in the name of legendary leader late Biju Patnaik and a sum of Rs.120.00 Crore has been provided for this purpose in the current year’s Budget.

• The State Government have enhanced MLALAD Fund from Rs.50 lakh to Rs.75 lakhs. An amount of Rs.147 Crore has been provided in the Budget of the current financial year which includes arrear of Rs.36.75 Crore of previous year on account of increase in MLALAD fund and Rs.110.25 Crore for the current financial year.

• Rs.30 Crore has been provided in the Budget of the current financial year for Western Orissa Development Council (WODC).

• A sum of Rs.16.10 Crore has been provided in the Budget of Planning & Co-ordination Department for Orissa State Employment Mission.

• The State Government have launched a new Scheme called “Gopabandhu Gramin Yojana” (GGY) from the financial year 2006-07 with a view to providing additional development assistance to the targeted 11 Districts which are not covered under the Backward Region Grants Fund. The main objective of the Scheme is to provide infrastructure consisting primarily of Electricity, Road and Water Supply to such Revenue villages. For the financial year 2007-08, a sum of Rs.110.00 Crore has been proposed specifically in the Budget.

• While Rs.1 Crore was provided in the Budget for the financial year 2006-07 for TRIPTI Programme meant for poverty eradication, the same has been increased to Rs.45 Crore in the Budget for 2007-08.

• A sum of Rs.69.65 Crore has been proposed as state share in the Budget for 2007-08 towards Indira Awas Yojana as against Rs.51.00 Crore provided in the Budget of last financial year.

• While there was no provision in the original Budget of 2006-07 towards National Rural Employment Guarantee Scheme, Rs.100 Crore has been proposed as state share towards NREGS for the financial year 2007-08.

• Central Government have implemented Backward Region Grant Fund in 19 backward Districts of the State. Rs.324.28 Crore has been provided in the Budget for the financial year 2007-08 for the purpose.

• While Rs.13.03 Crore was provided in the State Plan Budget in 2006-07 under National Family Benefit Scheme for One Time Assistance of Rs.10,000 to bereaved BPL families on death of chief earning member of the family, in the current year’s Budget an equal amount has also been provided for the purpose.

• A sum of Rs.67,19,42,000 was provided in the original Budget for 2006-07 towards State’s share of Mid-Day-Meal. An equal amount has also been provided in the Budget estimate for 2007-08.

• The Emergency Feeding Programme is being implemented in the 8 KBK Districts. Under the Programme, 2 lakh old, infirm, and indigent persons belonging to BPL households are provided cooked food for one time in a day. Each beneficiary is provided with 250 gms. of rice per day. For this purpose, Rs.20.50 Crore is proposed in the Budget for 200708.

• While a sum of Rs.32.81 Crore was provided in the original Budget for 2006-07 towards share of State Government for Supplementary Nutrition Programme, it has been increased to Rs.96.07 Crore in 2007-08.

• Pre-Matric Scholarship of residential students belonging to S.T. and S.C. communities has been increased. While there was a provision of Rs.40.82 Crore in the original Budget of 2006-07 for the purpose, the same has been increased to Rs.84.77 Crore in the Budget for 2007-08. Similarly, Rs.3.34 Crore has been proposed in the Budget Estimate for 2007-08 towards Post-Matric Scholarship.

• In order to provide cycles to girl students belonging to Scheduled Tribe communities who have passed HSC Examination and pursuing higher education, it has been proposed to provide Rs.81.00 lakhs in the current year’s Budget.

• There is a provision of Rs.53.01 Crore in the Budget for 2007-08 for construction of Hostels for SC & ST students.

• There is a provision of Rs.127.14 Crore in the Budget for 2007-08 under Special Central Assistance for Tribal Areas Sub-Plan. The same is meant for development of the people of Tribal Areas.

• While there was provision of Rs.101.43 Crore towards Grant-in-Aid Salary in the original Budget for 2006-07, the same has been increased to Rs.125.56 Crore in
the Budget for the year 2007-08.

• It has been proposed to allocate Rs.128.35 Crore towards Grant-in-aid salary in respect of Higher Education Department out of which Rs.21.00 Crore is meant for Non-Government Colleges. Similarly, it has been proposed to allocate Rs.5.00 Crore for Infrastructure Development of Ravenshaw University.

• Rural Health Mission under Health and Family Welfare Department is being implemented in order to provide health care facilities in rural areas. It has been proposed to allocate Rs.60.92 Crores in the Budget for 2007-08 towards the State’s share.

• It has been proposed to complete 3 bridges and 8 roads covering 76.56 km at an outlay of Rs.54.73 Crore during 2007-08 under Central Road Fund.

• It has been proposed to allocate Rs.115.00 Crore during current financial year under RIDF for construction and improvement of Roads & Bridges under Works Department. An equal amount was alsoprovided in the original Budget for 2006-07.

• As against the original provision of Rs.31.00 Crore in the Budget for 2006-07, a sum of Rs.46.00 Crore has been estimated in the Budget of current financial year to improve 7 roads under One Time Additional Central Assistance.

• It has been proposed to allocate Rs.92.20 Crore in the Budget for the current financial year towards Orissa State Road Project under Externally Aided Project (EAP). It is to be mentioned that in the original Budget of the last year, a sum of Rs.51.00 Crore was provided for this propose.

• For connectivity of Roads & Bridges in KBK Districts under Special Central Assistance Scheme, a sum of Rs.8.00 Crore has been provided in the Budget for the current financial year.

• In Works Department while in the original Budget for the financial year 2006-07, Rs.377.16 Crore was provided under the State Plan Sector, this has been increased to Rs.430.41 Crore during the current financial year.

• A new scheme has been proposed to be implemented in the current financial year under State Plan in order to provide self-employment to the unemployed youth. For this purpose, Rs.3.02 Crore has been proposed in the Budget for the current year.

• For the first time, a sum of Rs.6.80 Crore has been proposed in the Budget for 2007-08 for Infrastructure Development of Constituent Colleges under Biju Pattnaik University of Technology (BPUT).

• While there was provision of Rs.87.30 lakh in the original Budget for 2006-07 for Self Employment of unemployed S.C youth, the same has been increased to Rs.2.00 Crore in the Budget for the current year.

• In order to implement a new scheme named “Intensive Mineral Exploration and Assessment of Steel & Mines Mineral Resources”, Rs.5.00 Crore has been provided in the Budget of the current financial year.

• While there was a provision of Rs.3.81 Crore for “E-governance” in the original Budget for 2006-07, it has been increased to Rs.18.76 Crore in the Budget for 2007-08.

• For the first time, funds amounting to Rs.5.00 lakh has been provided in the Budget of I.T. Department for “On Line File Movement & Tracking System”.

• It has been proposed to allocate Rs.4.20 Crore in the Budget of the current year for establishment of “International Institute of Information Technology”.

• There was provision of Rs.1,10,80,000 in the original Budget for 2006-07 of Science and Technology Department for “Integrated Rural Energy Programme”. An equal provision has also been made in the Budget for the current financial year.

• While there was provision of Rs.16.00 lakh for “Orissa Science Academy”, it has been proposed to increase the same to Rs.20.00 lakh in the Budget for the current financial year.

• While there was provision of Rs.13.98 lakh in the original Budget for 2006-07 for popularization of Science, it has been proposed to allocate Rs.30.00 lakh during the current financial year for the purpose.

• While there was provision of Rs.56.25 Crore in the original Budget for 2006-07 in respect of “Jawaharlal Nehru National Urban Renewal Mission”, it has been proposed to allocate Rs.62.25 Crore in the Budget of the current financial year.

• It has been proposed to allocate Rs.25.40 Crore in the Budget for the year 2007-08 for Urban Water Supply.

• A sum of Rs.21.60 Crore and Rs.6.39 Crore have been provided in the Budget for the financial year 2007-08 as Grant-in-aid to Orissa Water Supply and Sewerage Board and Bhubaneswar Development Authority respectively in order to repay the loan obtained from HUDCO for Water Supply Project.

• As against the provision of Rs.80.00 Crore in the original Budget of last year, a sum of Rs.100.00 Crore has been provided in the Budget for the current financial year towards Rural Water Supply.

• During the current financial year, there is a provision of Rs.58.00 Crore under RIDF for construction and improvement of Roads and Bridges under Rural Development Department.

• There is total provision of Rs.185.10 Crore in respect of State Plan under R.D. Department during the current financial year.

• Rs.3.00 Crore has been provided in the State Plan Sector in the Budget for the year 2007-08 in respect of Tourism Department for preparation and display of high quality Cinema and for promotion of Tourism .

• While there was total provision of Rs.7.05 Crore in the original Budget of 2006-07, it has been augmented to Rs.10.16 Crore in the Budget of the current financial year.

Plan Outlay in other Sectors

• As against the original provision of Rs.290.00 Crore in the Budget for the year 2006-07 in respect of Rural Infrastructure Development Fund, it has been proposed to allocate Rs.310.00 Crore in the Budget for the year 2007-08.

• While Rs.516.00 Crore was provided in the original Budget for 2006-07 for Externally Aided Projects, the same has been increased to Rs.793.20 Crore in 2007

11. Highlights of Non-plan Revenue Expenditure. Rs.18,078.24 Crore has been provided towards Non-Plan Revenue Expenditure in the Budget for the financial year 2007-08. I now point out some important highlights of the Non-Plan revenue expenditure for information of Hon’ble Members of the House.

• State Government is giving adequate emphasis on development of Higher Education for which a sum of Rs.35.00 Crore has been provided in the Budget for the year 2007-08 as given below.

Utkal University : 3.50 Crores
Berhampur University : 3.50 Crores
Sambalpur University : 4.00 Crores
Shree Jagannath Sanskrit University : 2.00 Crores
Orissa University of Agriculture & : 2.50 Crores
Technology
Fakir Mohan University : 7.00 Crores
North Orissa University : 7.00 Crores
Ravenshaw University : 5.50 Crores

It has been proposed to allocate of Rs.17.00 Crore in the Budget for the current financial year towards arrear pay in respect of both Government and Government Aided Institutions under Higher Education Department out of which Rs.11.00 Crore and Rs.6.00 Crore are meant for Aided Educational Institutions and Government Colleges respectively. Similarly provision of funds amounting Rs.143.41 Crore has been made in this year’s Budget as Grant-in-Aid to different Institutions under Higher Education Department.

While Rs.167.42 Crore was provided in the original Budget for the year 2006-07 towards Sarba Sikhya Abhijan (SSA) under School and Mass Education Department, the same has been increased to Rs.170.33 Crore in the Budget for the financial year 2007-08.

· A sum of Rs.4.00 Crore has been provided in the Budget for the current financial year for renovation of Rabindra Mandap and Bhanja Kala Mandap.

• As per the recommendations of 2nd State Finance Commission a sum of Rs.19.85 Crore, Rs.5.00 Crore and Rs.11.74 Crore has been provided in the Budget for 2007-08 for repair and maintenance of Minor Irrigation Projects, repair and construction of G.P roads and for other
development work respectively.

• It has been proposed to allocate Rs.25.00 Crore for addition, alteration and maintenance of Hostel and Schools for the SC and ST Students.

• While Rs.9.78 Crore was provided in the original Budget for 2006-07 towards Diet Allowance of Prisoners of different Jails, the same has been increased to Rs.12,58,76,000 in the Budget for the financial year 2007-08.

• While Rs. 2.00 Crore and Rs. 1.77 Crore have been provided in the Budget for the current financial year for Infrastructure Development and purchase of Equipments respectively for Acharya Harihara Regional Cancer Centre, Rs. 2.10 Crore each for V.S.S. Medical College, Burla and M.K.C.G. Medical College, Berhampur, has been provided for increase of MBBS seats from 107 to 150.

• There is a provision of Rs.10.00 Crore in the Budget for Revenue & 2007-08 for distribution of Land Pass Book. Assistance is expected from National Calamity Contingency Fund. Accordingly, there is a provision of Rs.150.00 Crore in the Budget for the financial year 2007-08.

• There is a provision of Rs.60.30 Crore towards State Share and Rs.180.87 Crore towards Central Share (totalling to Rs.241.17 Crore ) in the Budget for 2007-08 on account of Relief Expenditure.

Non-Plan Expenditure in Other Sectors

• During first year of the 11th Plan period i.e financial year 2007-08, Rs.200.00 Crore has been transferred from Plan to Non-Plan Sector towards committed liabilities. It includes repair of Roads and Buildings, maintenance and repair of completed Irrigation Projects and maintenance of Irrigation Projects under Water Resources Department, provision of stipend and scholarship for the students of ST & SC Development Department, Block grant and Salaries of Universities under Higher Education and Agriculture Department.

· For maintenance of Government Buildings, Residential Buildings and Roads, provision of Rs.1138.51 Crore has been proposed in this year’s Budget which is higher by Rs. 322.34 Crore compared to the original Budget for the year 2006-07.

· Rs. 4049.11 Crore towards Interest Payment in respect of Loans obtained from Govt. of India and other Institutions.

· Rs.2125.36 Crore towards pension and other retirement and benefits.

12. While during the financial year 2006-07 expenditure in Capital account was estimated at Rs.1349.21 Crore, this has been increased to Rs.1913.77 Crore in the Budget estimate for the current financial year. Because of this, more funds will be available for infrastructure development.

13. Consequent upon introduction of Value Added Tax (VAT) w.e.f. 1.04.2005, revenue collection has increased in Commercial Taxes organization. While an amount of Rs.2471.39 Crore was collected during 2004-05, this has increased to Rs.3011.73 Crore during 2005-06. As per preliminary information, this has further increased to Rs.3764.82 Crore in 2006-07. During the current financial year, State Government have changed the Value Added Tax Rate of 35 commodities which would be helpful in augmentation of State’s revenue as well as for the benefit of the small dealers and poor consumers. For example, while VAT has been increased on tobacco, the same has been reduced on tea. 9 items of goods have also been exempted from VAT.

14. Out of grants from DFID and 11th Finance Commission, 54 offices in Commercial Taxes organization (including 4 important check posts) have been computerized out of 111 offices.

15. Orissa Treasury Management System (OTMS) is being implemented since June, 2005 with DFID assistance. The principal objective of the Orissa Treasury Management System is to computerize all Treasuries, Special Treasuries and Sub-Treasuries in phases. For this, Computer System in all the Treasuries, Special Treasuries and Sub Treasuries are being linked with the main Computer System in the Directorate of Treasuries. Hence, no bill can be passed without allotment. Because of this, excess expenditure incurred beyond Budgetary provision, can now be prevented.

16. I may indicate here that steps are being taken to credit Pension related dues of retired Government employees in Bank Account through Computer during the current financial year. By this, pension payment and its accounting procedure will be simplified and difficulties of the pensioners will be removed.

17. Before I conclude, I want to inform the Hon’ble Members of this August House that it is incorrect to assume that problems of the State will be solved by making more provision in the Budget and expending the same in a routine manner. It is essential that we have to see whether the desired result is being derived from the money expended or not. I expect and believe that Departmentally related Standing Committees will examine this aspect while analyzing the Budget of the Departments.

18. Another important aspect is timely and proper utilization of Central Assistance. Substantial improvement has been noticed in submission of Utilization Certificate in respect of Central Assistance received due to regular monitoring and supervision by Government. For example, while Utilization Certificate amounting to Rs.2470.58 Crore was submitted during 2005-06, the same has increased to Rs.2852.25 Crore in 2006-07 which is Rs.381.67 Crore more in comparison to the previous year.

19. Hon’ble Speaker Sir, while presenting the Budget for the financial year 2007-08, I have highlighted the financial situation, the estimated receipts and expenditure of the State and the sincere efforts of the Government to mitigate the persistent problems of the State. I am grateful to you Sir, and extend my gratitude to the Hon’ble Leader of the House and Hon’ble Leader of Opposition and also my heartfelt thanks to the Hon’ble Members of the House for giving a patient listening to me so long. I solicit the help and cooperation of this August House. I humbly pray before Lord Sri Jagannath for happy and prosperous future of our State.

‘Jai Hind’
‘Bande Utkal Janani’
Shri Prafulla Chandra Ghadai,
Minister, Finance.

PRESS RELEASE 29.05.2007 (CM ATTENDS NDC MEETING)

GOVERNMENT OF ORISSA

PRESS RELEASE

New Delhi

May 29, 2007

NAVEEN PATNAIK DEMANDS HIGHER ALLOCATION FOR ORISSA

TO CORRECT THE NEGLECT OF THE CENTRE

Speaking at the 53rd meeting of the National Development Council in their special session on Food and Agriculture, the Chief Minister, Shri Naveen Patnaik today demanded that the historical neglect for Eastern States like Orissa should be corrected during the 11th Plan.The advanced States of the country have had the benefit of huge public investment in irrigation and other related infrastructure in the past and the Eastern States have lost out in this race, he said. He pointed out that the various Working Groups on Agriculture have observed that the Eastern region has the maximum potential for agricultural growth during the 11th Five Year Plan and therefore region specific programmes based on the specific requirements of the different agro-climatic zones should be drawn up instead of uniform nation-wide schemes of one-size-fit-all variety.

Since irrigation is the key in agricultural growth, he suggested that Accelerated Irrigation Benefit Programme (AIBP) should have a large outlay and include not only major and medium irrigation projects but should also be extended to minor and lift irrigation projects.

For those lands which cannot be provided with assured irrigation, he suggested that a massive programme should be drawn up to cover rainfed areas on a Mission mode. He demanded that adequate funding support be provided by Government of India to the Watershed Mission of Orissa which has been set up by his Government to tackle the problems of rainfed agriculture.

He also suggested that seed production should be decentralized and seed villages encouraged so that adequate quantities of certified seeds are available to the farmers at affordable rates. He pointed out that nearly 70% of the cultivable land of Orissa is acidic in nature and transport subsidy should be provided by Government of India for gypsum and other inputs used for soil amendment.

Certain districts of Orissa such as Phulbani and Koraput have excellent potential for production of organic fruits, vegetables and spices. Since these districts are in the tribal sub-plan area, the resource-poor farmers cannot afford the high cost involved in certification of organic products. He suggested that the cost of such certification may be borne by the Government. He made a strong plea for a comprehensive crop insurance policy for cotton farmers of the State mainly in the Eastern and Southern parts of the State.

The CM also stated that farm mechanization and micro-irrigation systems are necessary in order to improve productivity of the land and timely agricultural operations. Specific schemes should be drawn up to promote a large number of cold storages in private sector with attractive incentives in the form of capital investment subsidy. Cold chain and post harvest management interventions should be put in place in order to support this sector, he added.

Telegraph reports that the Orissa government under the able guidance of the Veternary director Bishnupada Sethi has introduced several schemes for the growth of poultry farming. Following are some snippets from that article.

“… Value added tax (VAT) charged on maize and broken rice used for preparation of poultry feed would be reimbursed by the finance department. Similarly, the cooperation department has been asked to waive a per cent of the market tax levied on eggs, chicks and birds, brought to the regulated market committee yards,” said the Orissa veterinary director, Bishnupada Sethi, while talking to The Telegraph today.

Insurance premium for each poultry farm has, in the meanwhile, been revised from Rs 4 per layer bird to a meagre 30 paisa, the veterinary director added. Also, the Orissa electricity regulatory commission has been asked to reduce the tariff for poultry.

… The state’s production has increased from 12 lakh per day in 2005-06 to 32 lakh during 2006-07.

But still there seems to be a lacuna as the state’s present demand stands at 64 lakh eggs per day.”

Samaja reports that the government will help establish one chicken hatchery in each district and its aim will be to produce 1 crore eggs per day.