Punjab economy updates
Gross State Domestic Product (GSDP)
The Gross State Domestic Product (GSDP) of Punjab for 2019-20 (at current prices) is estimated to be Rs 5,77,829 This is 11.5% higher than the revised estimate for 2018-19.
Economic growth rates
The growth rate of Punjab’s GSDP (at current prices) has increased from 9.9% in 2015-16 to 10.7% in 2017-18.
In 2017-18, the sectors of agriculture, manufacturing, and services contributed to 30%, 24%, and 46% of the Gross State Value Added respectively. Between 2016-17 and 2017-18, the sectors grew by 10%, 8.5%, and 9%, respectively.
Per capita income of Punjab
The per capita net GSDP of Punjab in 2017-18 (at current prices) was Rs 1,41,552. This is 9.5% higher than that in 2016-17.
Unemployment rate
According to the 5th Annual Employment-Unemployment Survey (2015-16), among the major states, the rate of unemployment is 6% in Punjab which is higher than the all-India level of 5%.
Capital expenditure
Capital expenditure for 2019-20 is proposed to be Rs 68,296 crore, which is an increase of 51.4% over the revised estimates of 2018-19. Capital expenditure includes expenditure affecting the assets and liabilities of the state, such as: (i) capital outlay, i.e. expenditure which leads to creation of assets (such as bridges and hospitals), and (ii) repayment and grant of loans by the state government.
Revenue expenditure
Revenue expenditure for 2019-20 is proposed to be Rs 90,197 crore, which is an increase of 9.6% over revised estimates of 2018-19. This expenditure includes payment of salaries, pensions, and interest, among others. Revenue expenditure accounts for 57% of the total expenditure of 2019-20.
Non Tax Revenue of punjab
Punjab is estimated to generate Rs 9,477 crore through non-tax sources in 2019-20. Of this, Rs 1,407 crore will be the interest received by the state from the Punjab State Electricity Board.
Fiscal Deficit 
This is the excess of total expenditure over total receipts. This gap is filled by borrowings by the government, and leads to an increase in total liabilities. In 2019-20, Punjab’s fiscal deficit is estimated to be Rs 19,658 crore, which is 3.4% of the GSDP. The estimate is higher than the 3% limit prescribed by the 14th Finance Commission. This limit may be relaxed to a maximum of 3.5%, if states are able to contain their debt and interest payments to certain specified levels.
Revenue deficit
This is the excess of revenue expenditure over revenue receipts. A revenue deficit implies that the government needs to borrow in order to finance its expenses which do not create capital assets. The budget estimates a revenue deficit of Rs 11,687 crore (or 2.02% of GSDP) in 2019-20. This implies that revenue receipts are expected to be lower than the revenue expenditure, resulting in a deficit. The 14th Finance Commission had recommended that states should eliminate revenue deficits. The 2019-20 estimates for Punjab suggest that the state will not be able to meet this target of eliminating revenue deficit.
Total expenditure
Total expenditure for 2019-20 is estimated to be Rs 1,58,493 crore, a 24.4% increase over the revised estimate of 2018-19. In 2018-19, there is estimated to be a decrease of Rs 2,282 crore (1.8% of the budgeted estimate) of expenditure as per the revised estimate.
Total receipts
Total receipts (excluding borrowings) for 2019-20 are estimated to be Rs 94,195 crore, an increase of 32.4% as compared to the revised estimate of 2018-19. In 2018-19, total receipts (excluding borrowings) are estimated to fall short of the budgeted estimate by Rs 2,725 crore (3.7%).
Revenue deficit
Revenue deficit for the next financial year is targeted at Rs 11,687 crore, or 2.0% of the Gross State Domestic Product (GSDP). Fiscal deficit is targeted at Rs 19,658 crore (3.4% of GSDP).
Power subsidy
An amount of Rs 1,513 crore has been allocated for providing subsidised power to industries. Further, Rs 1,916 crore has been announced for providing subsidised power to domestic consumers, including Scheduled Caste, Backward Class, and below-poverty line consumers.
Agriculture and allied activities budget
As per the budget speech, crop loans of up to Rs 2 lakh taken by small and marginal farmers, as well as landless labourers will be waived. An amount of Rs 3,000 crore has been allocated for this provision of crop loan waivers. Further, an allocation of Rs 8,969 crore has been made for providing free power to the agriculture sector.
Budget for Rural development
A new scheme, Smart Village Campaign, has been announced for strengthening infrastructure in rural areas. For this, an amount of Rs 2,600 crore has been announced.
Infrastructure budget
A provision of Rs 700 crore has been made towards Atal Mission for Rejuvenation and Urban Transformation (AMRUT), which is aimed at upgrading urban infrastructure in 16 cities of Punjab. Further, Rs 300 crore has been allocated towards the Punjab Urban Environment Improvement Programme.
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