If the newly formed SAD-BJP government in Punjab decides to abide by all its promises specially that of subsidised atta-daal, it could burden itself with Rs 450 crore (assuming there are 63.5 lakh persons living below the poverty line). Also going ahead with its promise of free power and water to farmers apart from keeping several big and small promises would only work to its disadvantage by disbalancing its economy. Even the promise of doubling the old age pension to Rs 400 would mean an additional expenditure of about Rs 300 crore every year.

Some senior bureaucrats involved in the policy and planning indicated that continuing populist measures, over a period of time, had already had a cascading effect on the financial situation of Punjab and any further promises now would only make things difficult for the new political regime. The officers fear that the government resort to imposing more taxes to rectify the situation. Officials in the Punjab Finance Department stated that SAD had promised more “affirmative action” to win votes but fulfilling the promises would require mobilisation of additional financial resources especially when wages, pension, interest and grants to aided institutions slice off a major share of the government revenue.

Some decisions of the Amarinder Singh government had already burdened the state exchequer. The abolition of octroi besides the provision of power on subsidised rates and waiver of the water-sewer bills for houses measuring 125 sq. yards or less had resulted in an additional Rs 1,000 crore burden on the state exchequer every year. The subsidised power to the farmers was already costing the government Rs 850 crore.

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