Jammu, Nov. 22: Jammu and Kashmir is desperately working to stay out of the debt trap in which it is about to plunge.
The state owes nearly Rs 2,000 crore to the northern grid for power import and another Rs 1,500 crore to the Centre by way of loan repayment and interest.
“It is just the tip of the iceberg of the problem plaguing the state,” official sources said.
“Our coffers are empty. Soon, we may not be having money to pay salaries to our employees,” a senior official said, adding the situation may be “as bad as Brazil”.
Against the power tariff payment of Rs 1,950 crore, the state has only Rs 75 crore in terms of recoveries.
The northern grid has threatened to cut off supply if the tariff payment is not made soon. “It is a scary scenario,” the official said.
Although the state’s finances have never been in sound condition, it has worsened over the years, particularly after terrorism hit the state and raised security-related expenditure. Terror also hit revenue collection and recoveries, partly because militants warned the people not to pay taxes.
The Centre bore with the situation as long as the state was under President’s rule from January 1990 to October 1996. Immediately after the installation of the elected government that year, it started pressing for recovery of power dues and repayment of the Central loan.
Tensions have grown between Srinagar and Delhi over this, so the Centre kept plan allocation at Rs 1,750 crore for three consecutive years starting 1998-1999, crippling the economy.
Matters worsened with the National Conference government splurging on non-productive areas like a golf course and purchase of aircraft.
“Now the golf course constructed at the cost of Rs 37 crore cannot be allowed to go waste. It needs to be maintained and every year it requires Rs 3 crore,” sources said.
The Mufti Mohammad Sayeed government is banking on the goodwill of the Centre to weather the crisis.
Kashmir Committee chairman Ram Jethmalani, on a three-day visit here, met Democratic Freedom Party chief Shabir Ahmad Shah today.
Jethmalani was accompanied by other members of the committee — journalists M.J. Akbar and Dileep Padgaonkar and Supreme Court lawyer Ashok Bhan — when he drove to Shah’s Sanant Nagar residence.
“The solution to the problem has to be somewhere in the middle of the strong postures taken by the government of India and the Kashmiri separatist leaders,” Jethmalani told reporters after the meeting.
“I am prepared to meet everybody. I am ready to hold talks with the new chief minister Mufti Mohammad Sayeed and his daughter Mehbooba Mufti, and senior leaders of the National Conference. I will meet anyone who is interested in a dialogue,” Jethmalani said.