On Tuesday (3 October), Punjab CM Bhagwant Mann admitted that his government has increased the loan burden of the state. He informed that his government has raised loans worth Rs 47,107 crore in just 18 months of its tenure. He also urged Governor Banwarilal Purohit to convince PM Modi to not collect repayment of loan (moratorium on debt repayment) for at least the next five years.
Additionally, Punjab CM Mann also asked the Governor to take up the issue of Rural Development Fund (RDF) with the Prime Minister.
Bhagwant Mann said, “I would also urge upon you (Governor) to convince Hon’ble Prime Minister to not only release the pending RDF but also accord a moratorium on debt repayment of the State for at least 5 years.”
Punjab CM Bhagwant Maan writes to Punjab Governor Banwarilal Purohit, giving details of the increase in debt by his Government.
— ANI (@ANI) October 3, 2023
Bhagwant Maan writes, "I would also urge upon you to convince Hon'ble Prime Minister to not only release the pending RDF but also accord a moratorium… pic.twitter.com/5WeQ3WmHlr
Notably, he made this announcement while replying to the Governor’s letter in which he had sought details of the Rs 50,000 crore loan that the Mann-led AAP government had raised during its tenure.
In his reply letter, Mann claimed that nearly 57% of the loan had been spent only to repay the interest on loans inherited by the previous state governments. He noted that an additional Rs 47,107.6 crore was added to the debt, out of which, Rs 27,016 crore were spent on debt servicing.
According to Mann’s Demi Official (DO) letter, the AAP government borrowed Rs 47,107 crore while it ended up spending Rs 48,530 crore during its tenure in the state.
As per the details furnished in his letter, from April 2022 to August 2023, the net addition to the Punjab’s debt had been Rs 47,107.6 crore. This includes market loans, loans from NABARD, externally aided project loans and long-term loan under Special Assistance for Creation of Capital Assets.
The Punjab CM added that the government has recorded an increase in receipts. He added that the additional receipts have helped immensely in making value-accretive investments and initiating payment of arrears and unpaid dues.
After giving details regarding loan and expenditure, CM Mann urged the Governor to “convince Hon’ble Prime Minister to not only release the pending RDF but also accord a moratorium on debt repayment of the state for at least 5 years”.
In his letter, he argued, “This will provide much-needed relief to the strained financial position of the state and would give some fiscal elbow room to your government to accelerate the growth of revenue and the pace of the development.”
