By Our Correspondent in Bhubaneswar, January 30, 2015 :

Odisha government has finally settled for Odisha’s Annual Plan for 2015-16 at Rs 40,000 crore compared to the Annual Plan size of Rs 40,810 crore in 2014-15.

However due to poor resource mobilization and expected Rs 3,723.31 crore shortfall in central assistance, the Plan size for the current fiscal has been scaled down to Rs 35,000 crore in the revised estimates (RE) for the year. The state government expects Rs 2,000 crore less mobilisation from the state’s own revenue collection target.

Official source said the state’s own tax revenue is expected to grow by 5.42 per cent and non-tax revenue at the rate of eight per cent over 2014-15.

In 2015-16, the state’s own tax revenue will be curtailed by Rs 1,500 crore due to the commissioning of the 15 million ton per annum oil refinery of Indian Oil Corporation Ltd (IOCL) in March next. The state government had allowed the oil major deferred payment of value added tax (VAT) for a period of 11 years from the date of commissioning of the refinery.

The estimated revenue sacrifice on this account is pegged at Rs 67,000 crore over a period of 11 years which is equivalent to Rs 23,500 crore in terms of present value.

The tight financial situation has forced the state government to rethink about market borrowing, which it had not resorted since 2006-07. The government plans t raise market loan of about Rs 7,501.31 crore for the next fiscal, source said.

The borrowing from the National Bank for Agriculture & Rural Development (Nabard) is projected at Rs 2,000 crore for financing projects under Rural Infrastructure Development Fund (RIDF). Resources for externally aided projects have been estimated at Rs 2,275 crore.