KOCHI: As Finance Minister TM Thomas Isaac presented a huge welfare-oriented budget, the worrying factor is the rising debt burden of the state exchequer. The total debt outstanding of the state, which stood at 29.82% of the GSDP, has increased to 36.11% in 2020-21, in terms of the revised estimate. And going by the budget estimate, the total debt is expected to shoot up further to 37.39% in 2021-22.
According to the budget, the total outstanding debt of the state will increase to Rs 327,654.70 crore, a whopping increase of Rs 92,023 crore from 2019-20. Of the revenue receipts of Rs 93,115 crore for 2020-21, Rs 28,026.05 crore or 30.09% will go to paying the salaries of the government employees. Another Rs 19,412 crore will be utilised for the payment of pensions and Rs 20,286.27 crore for interest rate payments. Simply put, nearly 73% of the government revenue will go only for the payment of salaries, pensions and interest payments.
“The Centre had hiked Kerala’s borrowing limit from 3 to 5% of the GSDP. The sad part is the state is using the extra funds just to pay the salaries, pensions and other welfare programmes,” said Jose Sebastian, an economist and former faculty, Gulati Institute of Finance and Taxation.
Allocation for PSUs drops to Rs 250 crore
T’Puram: The state budget allocation for public sector undertakings failed to bring cheers in the sector as the allocation was not in tune with previous years. An amount of Rs 250 crore was allocated for the PSUs altogether in the present budget, while it was Rs 299 crore in 2019-20.
The amount is meant for the modernisation of technology and diversification of products. Of the allocation, Rs 57 crore is marked for chemical industries, Rs 25 crore for electronic industries, Rs 42 crore for engineering industries, Rs 13 crore for ceramic industries, Rs 57 crore for electrical industries, Rs 28 crore for textile industries, and Rs 21 crore has been earmarked for other industries. An amount of Rs 35 crore is allocated as working capital.
Increasing debt
The total debt outstanding of the state, which stood at 29.82% of the GSDP, has increased to 36.11% in 2020-21, in terms of the revised estimate.
The total outstanding debt of the state will increase to Rs 327,654.70 crore, an increase of Rs 92,023 crore
from 2019-20