JAMMU: Jammu and Kashmir’s total debt rose to Rs 55,358 crore at the end of 2015-16 which was a little over 60 per cent of its GDP and close to 5 times of its tax and non-tax revenue, a CAG report has said.
The rise in debt shows increasing trend of dependence of the government on high interest rate market loans to fund its expenditure, the Comptroller and Auditor General of India (CAG) said in the report.
“The overall fiscal liabilities of J&K State has increased from Rs 48,314 crore at the end of March 31, 2015 to Rs 55,358 crore at the end of March 31, 2016”, the report for the year ended March 2016 said.
Expressing concern over the debt, the report said as a percentage of Gross State Domestic Product (GSDP) the stock of accumulated fiscal liabilities increased from 54.95 per cent at end of 2014-15 to 60.27 per cent at end of 2015-16.
At the end of 2015-16, the accumulated liabilities were 1.55 times of the government’s revenue receipts during 2015-16 and 4.92 times government’s own tax and non-tax revenues during the 2015-16, the report said.
The report further revealed that the buoyancy ratio of these liabilities with respect to GSDP during the year 2015-16 was 3.27 indicating that for each one per cent increase in GSDP fiscal liabilities grew by 3.27 times.
The percentage of the market loans to the total public debt, which was 61.05 per cent in 2011-12, rose to 65.70 per cent in 2015-16, the report revealed.
“This shows increasing trend of dependence of the government on high interest rate bearing market loans to fund its expenditure instead of improving state’s own revenue resources to generate developmental funds”, the report said.
“More than 70 per cent of current borrowings were utilised for repayment of earlier debt leaving behind less than 30 per cent for capital expenditure vis-a-vis creation of assets”, it said.
Not only this, the state’s own deficit also increased from Rs 21,832 crore to Rs 32,606 crore during 2011-16 leading to more dependence to the central government and market loans.
Public debt of the state government has also increased from Rs 22,692 crore in 2011-12 to Rs 32,031 crore in 2015-16 registering an increase of 41.16 per cent during the period 2011-16.