Bengal's debt pile balloons
Bengal’s public debt is set to balloon to Rs 4,31,928 crore — more than twice the sum it inherited from the Left Front government. The revised estimate of the outstanding loan in 2018-19 was Rs 3,95,322.57 crore.
The burden of past debt is forcing the state government to raise its market borrowings to Rs 53,774 crore from Rs 47,854 crore last year as the state plans to pay off Rs 56,183.16 crore of past debts, which include Rs 25,032 crore of the principal amount and Rs 31,151.16 crore as interest.
Bengal finance minister Amit Mitra said the government was set to bear the burden of loans borrowed by the previous government that are now maturing.
“This year (2018-19) we have given Rs 49,656.93 crore as total loan repayment. Next year (2019-20) it will go up to Rs 56,183.16 crore. I have informed the Assembly multiple times that our government had inherited debt of around Rs 2 lakh crore,” Mitra said after presenting the state budget for 2019-20 on Monday.
He added the debt taken through a bond issue at high interest during 2008-09 and 2009-10 is set to mature after 10 years and this puts the repayment burden on the current government.
The government has budgeted its total capital expenditure at Rs 52,636.38 crore in 2019-20, higher than the revised estimate of Rs 45,787.67 crore in 2018-19.
The total expenditure of the state government during 2019-20 is budgeted at Rs 2,16,964.33 crore against a revised estimate of Rs 2,05,937.27 crore in 2018-19.
Higher borrowings will help the state to finance its expenditure even as it anticipates total receipts to grow to Rs 2,16,960.33 crore from the revised estimate of Rs 2,05,952.85 crore in 2018-19.
The state’s tax revenue collection in 2019-20 is budgeted at Rs 65,546.12 crore, up 9.1 per cent over Rs 60,078.82 crore, the revised estimate of Rs 2018-19.
“Our tax collection, which was a meagre Rs 21,128 crore in 2010-11, has grown to Rs 57,700 crore in 2017-18, more than a two-and-a-half times increase,” Mitra said in his budget speech.
The finance minister added the state had maintained a prudent fiscal path.
“The revenue deficit as a percentage of GSDP which was as high as 3.75 in 2010-11 has come down to 0.96 in 2017-18. Also, fiscal deficit as a percentage of GSDP has reduced from a high of 4.24 in 2010-11 to 2.83 in 2017-18,” Mitra said.
He added that the total budget allocation has increased to Rs 2,37,964 crore in 2019-20, an 11 per cent increase over the previous year.
The state’s gross domestic product is estimated to touch Rs 11,55,000 crore in 2018-19 from Rs 4,74,000 crore in 2011, Mitra said in his speech.