Ruchika M Khanna
Chandigarh, July 24
Previous governments not only mortgaged several state assets to raise loans, but even pledged future revenues to raise resources. This has put the state in a position where its financial stability is threatened.
From the Punjab Mandi Board (PMB) to the Punjab Infrastructure Development Board – the state’s once cash-rich institutions have been ‘run dry’ – as their future accumulations of funds have been pledged to raise more loans. It is learned that in the last two years alone, under Congress rule, Rs 2,879 crore was collected by the state by sequestering future income.
The issue was reportedly flagged during the recently held meeting of all chief secretaries attended by Prime Minister Narendra Modi.
Information collected by The Tribune shows that while the then SAD-BJP government (2012-17) raised a loan of Rs 3,134 crore to fund its urban rural mission program, it pledged around Rs 1,200 crore of rupees from his annual income for 10 years, from 2015-16, for debt repayment. Initially, the then government was sanctioned with a loan of Rs 5,000 crore but only Rs 3,134 crore was released by a consortium of banks.
Congress, after taking office, also went the same route and pledged the future accrued liabilities of the PMB for 10 years when it raised a loan of Rs 4,000 crore to fund the Crop Loan Waiver Scheme. Every six months, the council now has to disburse Rs 625 crore of its income for loan repayment and interest.
In addition to this, governments also mortgaged state properties to raise loans. The Tribune has been highlighting the problem for several years. In a report by the Comptroller and Auditor General of Punjab, released last month, it was pointed out that the Punjab Urban Planning and Development Authority had mortgaged several properties in order to raise resources. The report says that after analyzing the revenue and expenditure of the government’s Optimal Utilization of Vacant Land (OUVGL) scheme, they found that there was a debt balance of Rs 1,158.63 crore. This was satisfied by raising loans against the mortgage of OUVGL properties.
Notably, Punjab is one of the most indebted states in the country, with its arrears expected to exceed Rs 3 lakh crore by the end of this fiscal year. Following the crisis in Sri Lanka, the Center called on all states, including Punjab, not to undertake off-budget borrowing.
PUNJAB 3RD IN LIST OF OFF-BUDGET LOANS
Punjab was ranked third after Andhra Pradesh and Uttar Pradesh on the issue of mortgaging government assets and raising loans by sequestering future state revenues.
AAP GOVT TRYING TO FIX DAMAGE
Previous governments not only borrowed recklessly to fund targeted programs, but also pledged the future of the state. The AAP realizes the extent of fiscal mismanagement. We are trying to repair the damage. Harpal Cheema, FM