Srinagar (Jammu and Kashmir): With Jammu and Kashmir grappling with escalating financial pressure, with total liabilities surging to Rs 1,12,797 crore in the fiscal year 2022-23, former chief minister and NC Vice President Omar Abdullah has targeted the BJP led NDA government at the Centre for the “crippling debt”.
“In the 10 years of BJP/NDA rule at the centre all J&K has received is crippling debt. The powers that be love talking about a “naya Jammu & Kashmir” but what they forget to tell everyone is that the only legacy they are leaving for the elected government, when it comes, is one of back backing interest payments & a financial crisis,” Omar wrote in a post on X while reacting to an article highlighting Jammu and Kashmir's liabilities.
According to recent budget figures, public debt, a major component of the liabilities, has reached Rs 69,617 crore, driven by Rs 68,786 crore in internal liabilities and Rs 831 crore in loans from the central government. Additional liabilities include insurance and pension funds (Rs 1,331 crore), provident funds (Rs 28,275 crore), and other obligations (Rs 13,574 crore).
Despite these challenges, Finance Minister Nirmala Sitharaman expressed optimism in her recent budget speech, projecting a 7.5% growth in Gross State Domestic Product (GSDP) for 2023-24. The Jammu and Kashmir government has been focusing on equitable growth across all sectors, pursuing both tax and non-tax revenue avenues. Efforts include expanding GST dealer registrations from 72,000 in 2018 to 197,000 in 2023, implementing focused enforcement and dealer outreach programs, and improving tax collection efficiency.
Financial experts emphasize the need for a balanced approach that promotes economic growth while maintaining fiscal discipline. While the government’s initiatives to expand the tax base are seen as positive steps, more comprehensive reforms may be necessary to address the region's mounting liabilities.
The overall debt has increased from Rs 1,01,462 crore in 2021-22, with public debt alone rising from Rs 62,395 crore to Rs 69,617 crore in just one year. Over the past decade, the debt burden has more than tripled from Rs 29,972 crore in 2010-11, highlighting the urgent need for sustainable economic growth and expanded revenue sources. The debt-to-GDP ratio for Jammu and Kashmir is projected to reach 51 percent by 2024-25, raising concerns about long-term fiscal sustainability.
