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COVID-19 Lockdown: Maharashtra Govt Announces Budget Cuts, No to New Projects and Recruitment

While noting that the economy of the state will remain in a similar position for the next two-three months, the state Finance Department said that it’s going to be “a big challenge” to reshape the economy.
Uddhav Thackeray

Image Courtesy: PTI

Like other states, Maharashtra, too, has been witnessing the severe impact of the COVID-19 lockdown on its revenues. While noting that the economy of the state will remain in a similar position for the next two-three months, the state Finance Department said that it’s going to be “a big challenge” to reshape the economy, while announcing a slew of measures on Monday. It announced huge cuts on state's spending with a complete ban on launching of any new project in the state.

The government has instructed all the departments to review all the ongoing projects and works immediately and then stop or postpone them wherever possible. It has also asked the departments to send a proposal to the Finance Department by May 31 regarding halting of the projects. 

The government order further said that all departments will get only 33% of the allotted funds—which is to accommodate schemes funded by the Centre as well as provision of meals in the ongoing lockdown.

“There should be no spending on any new schemes including those which were cleared by the Cabinet in March 2020,” instructed the Finance Department. It even said that the departments shall not even propose any new scheme. 

The order has listed Public Health, Medical Education, Food and Civil Supply, Food and Drugs Administration as the ‘priority departments’; however, these too have been instructed not to start any work which is not related to COVID-19. All other expenses, including capital expenditure, are to be postponed. 

The state government has also called a halt to new recruitment in any of its departments. The state was supposed to recruit for about 76,000 posts from different departments, which had come as an assurance from the new Maharashtra Vikas Aghadi government. 

Maharashtra is already under a huge debt of almost 6,74,000 crores. Out of which, 4,60,000 crores is direct debt and 2 lakh is indirect. The state also has Rs 21,000 crore pending with the central government which includes GST dues and Centre’s share in various schemes. Meanwhile, the current lockdown has brought losses of the state up to Rs one lakh crore, as per the primary estimate of the Finance Department.

Also read: COVID-19: After 15 Deaths Due to Virus, MP Govt Agrees to Screen Bhopal Gas Tragedy Survivor

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