To finance the higher spending, he suggested that the Puducherry government seek at least 30% of the budgeted outlay as grants-in-aid from the Central Government (CG), amounting to Rs 4,050 crores, and to cover 100% funding for centrally sponsored schemes. Pointing out UT’s high debt of Rs 12,000 crore, equivalent to 24% of its State Domestic Product (SDP), he said that the CG should be approached for loan write-offs and grants to cover interest payments.
To boost its revenue, he suggested special drives to collect arrears of revenue from electricity, sales tax, transport, loans given to individuals and institutions, GST, and excise duties, tourism, and the monetization of unutilized government lands. Modernizing IT infrastructure to reduce revenue leakages and increasing taxes on vehicles and liquor were also suggested. Ramadass estimated these measures could increase the government’s revenue to about Rs 8,000 crore.
He recommended curbing unnecessary expenses, preventing fund diversions, and expediting capital project completion to save around Rs 1,000 crore. The remaining Rs 500 crore gap could be filled through market borrowing.
Ramadass called for the enactment of the Fiscal Responsibility and Budget Management Act (FRBMA) and the establishment of a Fiscal Road Map Commission to monitor fiscal developments and suggest corrective measures. He believes these steps will transform Puducherry’s economic landscape, generating jobs, income, and prosperity while reducing dependency on subsidies and pensions.