Within 72 hours after state budget, Bengal govt will resort to fresh borrowing

As per the budget estimates for 2021-22, the accumulated debt figure of the state government was Rs 5.35 crore. In the revised estimates for the same fiscal, the accumulated debt figure stands at Rs 5.28 lakh crore. Again in the budget estimates for 2022-23, the accumulated debt of the state government accumulated Rs 5.86 lakh crore.

KOLKATA: On Friday only, the new Finance Minister of West Bengal, Chandrima Bhattacharya presented the state budget for the financial year 2022- 23 on the floor of the Assembly. Just 72 hours after that on Monday, March 15, 2022, the state government is going for a fresh market borrowing.

According to a notification issued by the Reserve Bank of India (RBI), on March 15, 2022, altogether eight Indian states are going for market borrowing of Rs 13,639 crore from the open market. Tamil Nadu is the highest borrowing state in this tranche at Rs 5,000 crore, followed by the West Bengal government at Rs 3,000 crore.

The dependence of the West Bengal government on market borrowing to meet the daily expenses was revealed in different budget documents that were published on Friday.

As per the budget estimates for 2021-22, the accumulated debt figure of the state government was Rs 5.35 crore. In the revised estimates for the same fiscal, the accumulated debt figure stands at Rs 5.28 lakh crore. Again in the budget estimates for 2022-23, the accumulated debt of the state government accumulated Rs 5.86 lakh crore.

Worth mentioning in this regard is that in 2011 when the Mamata Banerjee-led Trinamool Congress government came to power in the state ending the 34-year Left Front rule, the state government's total accumulated debt was Rs 1.99 lakh crore. Economists feel that during the last 10 years there had been a sharp increase in the non-plan and recurring expenditure of the state government leading to this over-dependence on market borrowing to run the show.

Economic analysts also feel that populist projects like that of Lokkhir Bhandar have surely reaped rich political dividends for the Trinamool Congress in successive elections in the state. However, the state government has failed to find alternative means of revenue generation during the same period. So the dependence is so heavy on open market borrowings and state excise revenue.