The agency said their projections projected a strong economic recovery this fiscal year with a growth of around 15% in nominal GSDP
After registering a 3% decline in 2020-21, the total revenue of the states is expected to grow by around 15% this year, rating agency Crisil said on Tuesday, with a 20% growth in GST collections and around 25% in tax receipts. Referring to the leap, he said. on petroleum products.
While states’ indebtedness levels will improve marginally, from a decade’s high of 34% last fiscal to 33% this year, the rating agency estimated a 10% to 11% increase in revenue expenditure negating higher tax inflows. Will give
Further, while states had budgeted around ₹5.6 lakh crore in 2021-2022 for an increase of about 55% in capital outlay, CRISIL estimated the actual growth to be around 20% ‘given the past track record’ and Close to the level of their already widened fiscal deficit. 4% of Gross State Domestic Product (GSDP), ‘far above’ historical levels.
Ankit Hakhoo, director, Crisil Ratings, said, “As the economy recovers, the two major components of revenue – collections from GST and sales tax from petroleum products – are likely to comprise about 30% of the states’ revenue.”
Supported by higher inflation and better compliance levels, GST collections could grow by around 20%, while petroleum revenues could grow by around 25%, given the improvement in volumes and higher crude prices, he said.
The agency said their projections projected a strong economic recovery this fiscal with a modest GSDP growth of around 15%. “A more stringent lockdown than the expected intensity of the third COVID-19 wave could have a negative impact on economic growth and our projections,” it noted.
The agency’s estimate was based on a study of the top 18 states, which account for 90% of the total GSDP.
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