8 months ago
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The Comptroller and Auditor General (CAG) audit study for 2023-2024, portion highlighting the increasing indebtedness of the Puducherry government, besides points retired definite affirmative aspects of the Union Territory’s (UT) finances, specified arsenic its repayment illustration and indebtedness sustainability.
The study points retired that the UT’s outstanding indebtedness liability has steadily accrued from ₹9,449 crore successful 2019-20 to ₹13,084 crore successful 2023-24, rising year-on-year: ₹10,886 crore successful 2020-21, ₹12,594 crore successful 2021-22, ₹12,640 crore successful 2022-23, and ₹13,084 crore successful 2023-24.
Officials said the highest loans during the five-year play mentioned successful the study were taken successful 2020-21 (₹2,529 crore) and 2021-22 (₹2,516 crore) to flooded the fiscal accent caused by COVID-19.
Though the fig of outstanding liabilities of ₹13,084 crore was huge, considering the constricted scope of gross mobilisation oregon flexible manoeuvrability disposable with the Puducherry medication and the channelling of resources utilized towards indebtedness servicing, the authorities could find solace from the study that it could bring down the indebtedness to Gross State Domestic Product (GSDP) ratio to an acceptable/standard level, officials said.
Debt to GSDP ratio
Going by the finer details disposable successful the report, the UT’s indebtedness to GSDP percent was 23.48, arsenic against the prescribed bounds of 25%. In fact, the indebtedness to GSDP ratio had gone up from 25.54% successful 2019-20 to 28.04% successful 2020-21. The ratio of 26.30 reported successful 2021-22 past decreased to 24.17 successful 2022-23. The information showed that the UT has consistently maintained the indebtedness to GSDP ratio implicit 3 years, pointing to bully indebtedness management.
“The affirmative inclination connected the ratio indicates that the territory was successful a unchangeable presumption to repay its debt. The gross equilibrium shows a affirmative trend, and ratio of involvement outgo to gross receipts besides shows a decreasing trend, which is simply a bully indicator for indebtedness sustainability,” an authoritative said.
However, the interest was astir indebtedness financing, which mostly pertains to borrowed funds. During the five-year play of 2019-24, 57.02% of nationalist indebtedness receipts were utilised for the repayment of indebtedness taken successful erstwhile years. In 2023-24, arsenic against the borrowing of ₹1,269 crore, indebtedness repayment was against ₹957 crore, starring to lesser funds disposable for the instauration of superior assets.
The CAG said funds borrowed should beryllium ideally utilized to money superior and improvement works. Using borrowed funds for gathering existent depletion and repayment of involvement connected outstanding loans was not suitable. The audit bureau has besides pointed retired debased travel of funds for superior expenditure implicit the years. The study said, arsenic against the superior expenditure of ₹327 crore incurred during 2019-20, the magnitude spent connected the relationship successful 2023-24 was ₹439 crore, which constituted lone 4.18% of the full expenditure, indicating the government’s deficiency of prioritisation of infrastructure development.
For improving the UT’s fiscal position, the authorities should mobilise ain resources and fortify the machinery for the postulation of arrears of gross to trim the dependency connected borrowing. The authorities should get based connected its requirements only.
