The Rs 34,724 Crore Magic Wand
Supplementary grants usually take care of all the expenditure that you couldn’t budget for in a Union Budget, the annual federal book keeping exercise. By definition, it’s the extra. We are looking at the report released in August. The amount for 2011-12 is Rs 34,724 crore ($7.7 bn), of which the Government says the net cash outgo is (only) Rs 9,016 crore ($2 bn). Our job is to focus on the expenditure head so we will, net or not.
The big issues (and numbers) first. The Ministry of Rural Development is taking away Rs 2,300 crore for “meeting the additional requirement for the Below Poverty Line survey”.
The BPL lists have gaping holes which need to be fixed and indeed, that is the Government's endeavour presently. So the sum, if well spent, will save lots more. Though it’s not clear whether this will be a well co-ordinated exercise within Government. While the states will drive these lists, they are already working with central bodies like the Unique Identification Authority of India to give an identity to every Indian resident. Going back to the resident or citizen repeatedly can cause fatigue.
Our Members of Parliament are getting Rs 2,300 crore because their allocation under the MP Local Area Development Scheme allocation is going up from Rs 2 to Rs 5 crore each. There are some related expenditures as well. Obviously there is a story in the use and non-use of MP funds but that’s for another day.
An Oil Punt
Interestingly, the Government is combining development expenditure with some smart investment moves. Or not ? Its putting in Rs 1,585 crore for an additional equity investment in bonus shares issued by state-owned but publicly listed oil exploration major ONGC. In the last one year, ONGC’s stock price has moved between Rs 280 and Rs 311, so we guess it’s a safe bet. Be advised that ONGC also has a market cap of Rs 239,425 crore ($53 billion).
There is almost Rs 1,000 crore (additional) earmarked for buying more arms and ammunitions for various police departments including the Border Security Force (Rs 286 crore), Indo-Tibetan Border Police (Rs 64 crore), Central Reserve Police Force (Rs 140 crore) and some money to state government law enforcement authorities. All good. But why is it an afterthought, we wonder. Incidentally, the National Intelligence Grid (NATGRID) or Big Brother Grid as some might say is getting legs. A sum of Rs 104 crore has been earmarked for just the IT machinery and equipment.
And finally (for now), we seem to be doing more to spread our tax net, literally. So Income Tax Overseas Units are now present in 10 countries including sunny Cyprus and laid back Mauritius. So Rs 17 crore (additional, remember) is going here. Hope we find some of those billions of dollars of 'black’ money and bring it back.
There is a lot more that we are trying to fathom in the Supplementary Grants report but are currently awaiting some responses from officials at the Ministry of Finance. We would rather not be accused of interpreting wildly. There is an interesting story that is located in a thriving, energy-rich nation called Kazakhstan. Lakshmi N Mittal made his mark here as a global steel turnaround man.
And then other successes followed; for him and Kazakhstan. Between Jan-July 2011, the Kazakhstan National Fund’s assets rose 25% to touch $39 billion. In the same period, figures available with news agency caspionet.kz show that 'external turnover’ rose 25% to $2.6 billion.
It does not matter what the specifics are because we are looking at a young country who has figured out how to mine its natural resources and is thus generating wealth like never before. And thus all is well. And yet, India’s Department of Economic Affairs has waived outstanding dues of Rs 14 crore and Rs 21 crores of interest on loan outstanding from Kazakhstan. This pertains to a line of credit extended to the Government of Kazakhstan in 1993. Of course the amount is small and there must be some history to this. But interesting, isn't it?
Office Space, Finally
Finally, if you were wondering what former TCS CEO S Ramadorai was up to in his new Government job as Advisor to the Prime Minister’s National Council on Skill Development, here’s some news. His office has been given Rs 6 crore, presumably to get it up and going. Much has to be done in the area of skills. And people were starting to wonder if Mr Ramadorai was all there. Well, in order to build an empire, first you need table space.