Punjab CM Bhagwant Mann responds to Governor's loan query, reveals debt allocation details
PTC Web Desk: Punjab Chief Minister Bhagwant Mann on Tuesday replied to Governor Banwalilal Purohit's letter, providing a detailed breakdown of the state's debt, which amounts to Rs 47,000 crore, contrary to the initially reported Rs 50,000 crore. He clarified that around Rs 27,000 crore has been paid in interest on "loans acquired by previous governments".
Notably, Governor Banwarilal Purohit had sought loan details following Punjab CM Bhagwant Mann's request for assistance in clearing pending RDF dues from the Centre.
Additionally, the letter highlights various financial aspects, including power subsidies, government schemes, and outstanding dues such as GST. CM Mann also emphasised that "previous governments had accumulated a staggering debt of Rs 3 lakh crore during their tenures".
CM Mann called on the Governor to raise the Rural Development Fund (RDF) issue with Prime Minister Narendra Modi and request a five-year moratorium on the state's debt.
According to Bhagwant Mann's letter, the government borrowed Rs 47,107 crore, but ended up spending Rs 48,530 crore. The expenses included handling legacy debt, power subsidy arrears, sinking fund investment, sugarcane farmer arrears, unpaid central-sponsored schemes, and development expenditures.
CM Mann explained, "From April 1, 2022, to August 31, 2023, the net addition to the state’s debt has been Rs 47,107.6 crore, which includes not only market loans, but also loans from NABARD, externally aided project loans allowed by the Government of India, and long-term loans under special assistance for creating capital assets."
He highlighted that a significant portion of the debt, Rs 27,016 crore, went toward interest repayment on "inherited debt". CM Mann claimed that his government was addressing issues left by previous governments and used debt and revenue resources to fund neglected organisations and schemes while creating capital assets and promoting development.
Punjab CM Bhagwant Mann added, "I am committed to honouring the state’s rightful liabilities and servicing the debt in a timely manner while I strive to mobilise resources to fund development of the state."
The letter also pointed out increased receipts, including higher GST collections, excise collections, taxes on vehicles, and stamps and registration. These additional revenues supported investments, payment of arrears, and unpaid dues.
Mann urged Punjab Governor Banwarilal Purohit to convey to Prime Minister Narendra that the debt had been utilised effectively, and efforts were underway to strengthen state finances while providing employment to over 36,000 youth. He further called for the release of pending RDF and a five-year moratorium on debt repayment to alleviate the state's financial challenges and accelerate growth and development.
- PTC NEWS
