Fiscal Management Targets

In particular and without prejudice to the generality of the foregoing provisions, the State Government shall – (a) reduce revenue deficit to nil within a period of five financial years beginning from the initial financial year on the 1st day of April, 2004 and ending on the 31st day of March,2009; the annual reduction of revenue deficit on the average being rupees two hundred and eighty-five crores and after commencement of Odisha Fiscal Responsibility and Budget Management (Amendment) Act,2011, the revenue deficit shall be maintained at zero for the financial year, 2011-12 and for subsequent financial years. (b) reduce fiscal deficit to not more than three percent of the estimated gross domestic product within a period of five financial years beginning from the initial financial year on the 1st day of April, 2004 and ending of the 31st day of March, 2009 and from financial year, 2011-12 and onwards shall contain fiscal deficit within three percent of the estimated Gross State Domestic Product (GSDP). (c) omitted. (d) omitted. (e) Other important monitorable fiscal targets would be- (i) the ratio of salary to State’s own revenue is to be reduced to eighty percent by the year ending 31st day of March, 2008; (ii) the ratio of non- interest committed revenue expenditure to State’s own and Mandated Revenue is to be reduced to fifty-five percent by the year ending 31st day of March,2008: and (iii) omitted. (f) In order to bring the debt stock to a sustainable level, interest payment as a percentage of revenue receipt is to be limited to fifteen percent. (g) the total debt stock shall be limited to three hundred percent of the total revenue receipt of the State by the year ending 2007-08. (h) notify the debt GSDP ratio limit fixed by the Finance Commission and guidelines, if any, issued by the Government of India from time to time, and ensure that the debt GSDP ratio are maintained in accordance with the said limit; and Provided that the revenue deficit and the fiscal deficit may exceed the limits specified under this section on ground of shortfall in the central tax devolutations in relation to the budgetary estimates of the Union of India or unforeseen demands on the finances of the State Government arising out of natural calamity or such other exceptional ground as the State Government may, by order, specify: Provided further that a statement in respect of the ground on which the deviation has been made under the first proviso shall be placed before the State Legislature. Provided also that for any given financial year for which the borrowing limits are to be fixed if the debt-GSDP ratio is less than or equal to 25 per cent in the preceding financial year, the fiscal deficit may go up further by 0.25 per cent on the GSDP, when there is no revenue deficit in the said year and the immediate preceding financial year Provided also that for a given financial year for which the borrowing limits are to be fixed if the interest payments are less than or equal to 10 per cent of the revenue receipts in the preceding financial year, the fiscal deficit may go up further by 0.25 per cent on the GSDP, when there is no revenue deficit in the said year and the immediate preceding financial year: Provided also that if the Central Government requires the State Government to take over the debt of any State Public Sector Undertaking or Utility in a particular financial year, the fiscal deficit limit as fixed in this section may go up by the amount of debt taken over by the State Government in that financial year. The State Government shall, while presenting the Fiscal Policy Strategy, include therein details of the steps taken for restructuring the State Finances as recommended by the latest Finance Commission. (1) This Act may be called the Odisha Fiscal Responsibility and Budget Management (Amendment) Act, 2016. (2) It shall come into force on such date as the State Government may, by notification, appoint.