Govt’s focus on borrowings will impact state financial stability: Congress

Syllad | The Rising MeghalayaMarch 10, 2022

The opposition Congress on Thursday said that the budget presented by the Chief Minister Conrad K Sangma lacks vision and initiatives to overcome the current crisis brought about by Covid pandemic.

Addressing media persons, MPCC secretary in-charge social media Manuel Badwar said the focus of the government is on borrowings instead of internal generation of funds.

“The fiscal deficit itself has gone up to Rs.1849 crores from Rs.1570 crores in the previous year. It seems that the focus of the government is on borrowings rather than internal generation of funds and as a result just the interest payment itself has increased to Rs110 crores and which is also accompanied by the loan repayment itself of Rs. 946 crores. These two items themselves contribute to a large extent of our deficit,” Badwar said.

The MPCC Secretary also pointed out that there seems to be a trend that the loans procured are from more expensive sources like HUDCO (800Crs) which are more expensive when compared to the soft loans available and this adds up to the repayment burden of the state.

“With the increased borrowings of Rs.2632 crores this year as compared to Rs.2244 crores last year,  will definitely impact the financial stability of the state in the years to come,” he warned.

Badwar further alleged that budget failed to address the issues of unemployment/ employment generation and in providing sustainable opportunities for the people. 

“We  also do not see much initiatives in bettering the health and living conditions of the people.”

He also alleged the chief minister was busy in highlighting his achievement, however the fundamental macroeconomics of the state as one would deduce from the budget raises many red flags.

 Stating that the state’s revenue expenses have increased, he said, “Our revenue receipt has not gone up primarily because of the inability to improve our tax collection and as an example mining and quarry itself saw a huge slump where it contributed to less than 1% of our state GSDP (in spite of seeing many coal laden trucks plying on the roads everyday) from the hay-days when it used to contribute nearly 9-10%. We seem to be spending more on festivities and other soft items which do not translate to capital infrastructure building.”

“On the contrary, Capital Expenditure has gone down from Rs 3647 crore in 2021-22 to Rs.3505 crore in 2022-23. In fact, in all the budgets of the previous years presented under the current Chief Minister, there has been a trend of increased revenue expenditure in percentage terms as compared capital expenditure. It is a well-known fact that increased Capital Expenditure leads to asset creation, job creation, infrastructure development thereby propelling an economy in the growth trajectory,” MPCC secretary said.

He said that the youth will be the ones that will suffer the most in the years to come due to lack of opportunities.