Total borrowing from debt market in FY23 reaches Rs7500 cr
CL Jose
caption]
THIRUVANANTHAPURAM/August 29-2022: Kerala has borrowed additional Rs1000 crore over and above the Rs2000 crore announced as part of the borrowing programme organised by the Reserve Bank of India (RBI) for Monday (August 29).
With Monday’s borrowing of Rs3000 crore, the total borrowings from the debt market so far in this financial year stand at Rs7500 crore.
The additional Rs1000 crore was borrowed by issuing 20-year state development loans (SDLs), whereas Rs2000 crore was borrowed by issuing 12-year SDLs.
Thus, the borrowing during the month of August alone adds up to Rs4000 crore, with Rs1000 crore being borrowed earlier on August 23.
It may be intriguing to note that the Finance Department, as part of the circular, has mentioned, “the proceeds of the loan will be utilised for financing productive development programmes and projects to be implemented in the state.”
Which development projects are going to be funded through these borrowings could be explained by the people in the government only. This need not raise any eyebrows as it could be just a regulatory requirement to mention something under ‘Object of the Loan” as part of the documentation.
Against a total revenue receipt of Rs41,775.96 crore as of July end, 2022, the state’s borrowing and liabilities stood at Rs9468.28 crore and the committed expenses at Rs29,152.57 crore, which accounts for 70 per cent of the revenue receipts during the said period.
The Comptroller & and Auditor General (CAG) of India having raised objections to Kerala’s certain borrowings during the previous years through entities such as KIIFB and KSSPL, the state has been under pressure to slow down its borrowing during the current financial year, which is evident from the relatively low volume of borrowing so far in FY23.
Social security pension
The state has sanctioned Rs767.32 crore towards the distribution of social security pension for 50.24 lakh beneficiaries for the month of July and Rs771.75 crore towards the distribution of the pension for another 50.53 lakh, during the month of August.
The government will certainly be hard-pressed to cough up funds during the Onam season in order to meet the additional expenses on account of Onam advance, bonus and other allowances.
On Monday (Aug 29), the government has announced Rs4000 for government employees as Onam bonus and Rs2750 as festival allowance for those who are not entitled to bonus.
Moreover, all government employees will be entitled to get Rs20,000 as advance against salary.
The pay-out from the government exchequer during the next one week will be huge enough to unnerve the government’s finance planners.
