Ahmedabad: The report of the Comptroller and Auditor General of India tabled in the Gujarat Assembly has pointed out that the state government needs to formulate a "well thought out" debt repayment strategy to avoid falling into a debt trap. The 'State Finances Audit Report of the CAG for the year ended March 31, 2021' was tabled in the Assembly on Thursday, the last day of the Budget session.
As per the audit report, Gujarat's public debt, consisting of internal debt as well as loans and advances received from the Centre, was Rs 3,08,030 crore in 2020-21. Since a large portion of the debt was supposed to be repaid during the next seven years, the CAG pointed out that it may put a "strain" on the state budget. The maturity profile of outstanding stock of public debt as on March 31, 2021 indicates that 61 per cent of the total public debt, or Rs 1,87,973 crore, would be repayable within the next seven years, which may put a strain on the government budget during that period, as per the CAG stated report. It added that the remaining 39 per cent, or Rs. 1,20,056 crore, would become due for servicing after seven years.
In view of the increasing committed expenditure on one hand and revenue deficit on the other, the state government would have to work out a well thought-out borrowing-repayment strategy to avoid falling into a debt trap, the report stressed. The maturity profile of public debt of Rs 3,08,030 crore comprises internal debt of Rs 2,90,031crore, and loans and advances worth Rs 17,999 crore from the Union government. The CAG audit said the total outstanding debt of the Gujarat government increased from Rs 3,15,456 crore in 2019-20 to Rs 3,57,893 crore in 2020-21.
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