Mumbai: In its bid to achieve a trillion dollar economy in 2025, the state’s debt stock has risen to a worrisome Rs 4.12 lakh crore as per the economic survey of Maharashtra 2017-18.
Even the state’s interest payment has gone to Rs 31,027 crore for this year. Of the debt stock, the internal debt has reached Rs 3,31,435 crore, which is 80 per cent of the debt stock. Opposition members have suspected that the debt stock may turn out to be more in the budget to be declared on March 9.
According to the survey, “The rise in debt stock continues to be a matter of concern as it is estimated to be Rs 4.12 lakh crore in 2017-18 as compared to Rs 3.56 lakh crore in 2016-17.
The expected debt stock is 16.6 per cent of GSDP, well within the limit of 22.2 per cent laid down by the 14th Finance Commission. The average cost of borrowing is expected to be 8.4 per cent during 2017-18.”
The survey further said, “The internal debt of the state has reached Rs 3,31,435 crore which is 80.2 per cent of the debt stock. Of which the open market borrowings are expected to be Rs 2,54,366 crore. So out of the internal debt, 31 per cent will be used for repayment of loans.”
State finance minister Sudhir Mungantiwar said that there is no need to worry as the borrowing is in the limit prescribed by the finance commission. However, he also agreed that the state has requested the Centre to increase the borrowing limit by Rs 20,000 crore.
Though interest payments are increasing, their percentage to revenue receipts is decreasing and is expected to be 12.7 per cent during 2017-18. The government is spending about 46 per cent of the income on salary and pension while 12.5 per cent on the interest on borrowings.
However, Mr Mungantiwar said that the state government is trying to raise its revenue sources to meet the needs. “Our interest on borrowings are 12.5 per cent which is much better than other states. In Gujarat it is 16.83 per cent and in Karnataka it is 17.9 per cent. The fiscal deficit to GSDP is 1.6 per cent.
But in Gujarat it is 1.82 per cent, in Tamil Nadu 2.8 per cent, Karnataka 2.61 per cent. It is true that our revenue expenditure is more than other states. But we are trying to reduce it by adopting various measures,” he said.
