news details |
|
|
| J&K caught in vicious circle of debt liability | | Rising debts, capital and revenue expenditure presents worsening fiscal situation | | Jammu | Feb 17
Even as the state is witnesing zero-deficit budget over the years, the figures with regard to the performance of government in economic sector indicates deteriorating fiscal situation during the years 2005-06.
In its annual report, Comptroller and Auditor General of India has not only pointed out that the state of Jammu and Kashmir continue to depend on borrowings for plan or development expenditure but it has also criticized the way in which government departments were utilizing the money under various heads.
The worsening fiscal situation despite the state having received an increase of Rs 1,278 crore in Central transfers over the previous year indicates that the state’s own resources have not shown buoyancy during the year”, the CAG report observed adding, “The state therefore needs to take steps to improve the buoyancies in its own resources in combination with maintaining the growth in non-plan revenue expenditure as per the norms in order to have sustained improvement in its fiscal imbalances”.
The overall fiscal position of the state as reflected in terms of key parameters revenue, fiscal and primary deficits, indicates deteriorating fiscal situation during 2005-06 over the previous year.
“Although the state had maintained revenue surplus of Rs 394 crore during 2005-06, it was lower by Rs 168 crore as compared to the revenue surplus during 2004-05, while fiscal and primary deficits have shown substantial increases during the year”, the report pointed out.
It also reveals that the capital and revenue expenditure have increased by 38.5 per cent and 19.5 per cent during the year but revenue receipts and non-debt receipts could not keep pace with the increase in expenditure of the state.
Exposing the government claims of fiscal reforms, the CAG report clearly projects the true of economic condition of the state. “The cardinal indicators of debt such as quantum spread together with primary deficit being perennially negative, increasing ratio of fiscal liabilities to GSDP with a growing fiscal deficit and the higher buoyancy of the debt with regard to its revenue receipts indicates unsustainable debt situation of the state in the medium to long run”.
It further reads, “The spiraling debt liabilities accompanied by secular trends in fiscal deficit can result in a vicious cycle of deficit, debt and debt service payments, unless suitable measures are taken to arrest the persistent increase in fiscal liabilities”.
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| |
|
|
|
|
 |
|
|
