A debt of over Rs 2.5 lakh crore awaits whichever government comes to power post-March 10 results of the recently held assembly elections in Punjab.
The state government has the Punjab Fiscal Responsibility and Budget Management (FRBM) Act, 2003 in place and hence, the borrowing limit to reduce the debt/gross state domestic product (GSDP) ratio. The limit has been reduced from 42.75% in 2016-17 to 41.45% in 2017-18 to 40.34% in 2018-19 and 39.90% in 2019-20. However, the total outstanding debt of the state as of March 31, 2021, was projected at Rs 2,52,880 crore which is 42% of GSDP for 2020-21 (revised estimates) and the outstanding debt was likely to be Rs 2,73,703 crore in 2021-22 budgetary estimates 45% of GSDP.
The outstanding debt as a percentage of GSDP increased in 2021-22, primarily due to the government’s increased expenditure to bring a turn-around in the sluggish economy which was further marred by the lockdowns imposed due to the Covid-19 pandemic.
Punjab is among the highest indebted states in terms of debt-GSDP ratio in the country. Come poll season since January this year and all the political majors in Punjab vied with each other to woo voters with a plethora of freebies ahead of February 20 assembly polls in the state.
While the AAP had announced Rs 1,000 to every woman aged 18 or above if voted to power, the SAD had promised Rs 2,000 to all the blue card holder BPL women. Likewise, Congress has promised Rs 2,000 per month to women homemakers besides eight LPG cylinders, two-wheelers to girls taking admission in colleges for further studies, Rs 20,000 to those passing class XII, Rs 15,000 to ones passing class X, and Rs 5,000 to those passing class V.
Interestingly enough, commenting on the poor fiscal health of the state, the leaders of all the said parties held that they would enhance revenue significantly by checking the corruption in the lucrative business of mining, liquor consumption, and transport in which mafia have allegedly been operational in the state since years.
However, when asked for comments on poll-time promises of freebies, Prof Pramod Kumar, Director, Institute for Development and Communication, Chandigarh, said that with an aim to ensure a free and fair election in the truest sense of the word, the election commission should evolve a code of conduct for all the parties to check them while promising or giving guarantees without any solid basis for the same.
Prof Kumar says that it is also surprising when some parties get forms filled by voters and give them a signed document promising them jobs etc.
