‘Vibrant’ Gujarat does not appear to be in the pink of financial health. This was the indication when state Finance Minister Vajubhai Vala conceded in the Assembly on Wednesday that the state’s finances in the current fiscal have dipped to a whopping Rs 2,584 crore, against the anticipated Rs 876.20 crore.

He said this while presenting the Interim Budget for the first four months of the financial year 2009-10.

Seeking permission of the House for an expenditure of Rs 17,987 for the period between April and July 2009, Vala said the government has decided not to impose fresh taxes, nor come up with new schemes in view of the impending Lok Sabha elections.

Among the main allocations he announced for the April-July period include

Rs 1,207.42 crore for the agriculture and co-operation sector, Rs 951.67 crore under the JNNRUM and Rs 413.60 crore for modernising the farm sector. Later, while talking to mediapersons, Vala said the deficit in 2008-09 was much higher due to the prepayment of deep discount bonds of the Sardar Sarovar Narmada Nigam Ltd, for which the government has earmarked Rs 2,720 crore. Out of this, about Rs 1,800 crore had already been disbursed against premature redemption of the bonds

The minister said the government would be able to wipe out the current financial year’s deficit, as “we expect to come up with a surplus budget for the next fiscal with 8 per cent growth rate in the various states’ taxes”. The 2008-09 fiscal deficit that stands at 2.99 per cent in 2008-09 would have been at 1.6 per cent, if the government has had not to make prepayment of deep discount Narmada bonds, he added.