Kerala FM to present Budget tomorrow

Thiruvananthapuram, Mar 8 (UNI) Kerala Finance Minister Thomas Issac will present the Budget for 2007-08 in the state Assembly tomorrow, even as the Economic Review noted the continuing surge in economic growth.

This will be the second Budget for the ten-month-old Marxist-led Left Democratic Front (LDF) government in the backdrop of its decision to accept the controversial Rs 994 crore Asian Development Bank loan for sustainable urban development.

The government was forced to come out with some relief for agriculture and traditional industries which are still facing a major crisis.

''It is true that the economic growth during the past one decade was satisfactory, but the major weakness is the stunted growth rate in production in the agriculture and industries,'' Dr Issac told newspersons here. As per the estimates, the economic growth for the year 2006-07 was 8.8 per cent, as against 8.2 per cent during 2005-06.

Referring to the Economic Review which was tabled in the state Assembly today, the Minister said there was only a marginal increase in the agricultural production from Rs 12,276 crore in 1999-2000 to Rs 12,712 crore during 2005-2006. During the same period, industrial production declined from Rs 3,969 crore to Rs 3,892 crore.

The Economic Review stated that as a result of the stunted growth in these two major sectors, there was a decline in the income of 40 per cent of the population in the state, resulting in the widening of inequality in the society.

However, the trend was likely to change in the coming years as the prices of agricultural commodities, except coconut, registered an upward trend. The industrial production was also likely to go up.

Dr Issac said steps would have to be taken in the Budget to revive the agricultural and industrial sectors and also to improve the quality of social sectors. The state's financial health was a major hurdle for the effective intervention. The biggest challenge for the 2007-08 Budget would be to increase the revenue collection, he added.

UNI