The Gujarat government will sell its stock securities worth Rs 1,000 crore for 10 years, to fund various development programmes and schemes included in its annual development plan for 2009-2010.
The auction of the stock securities will be conducted by the apex bank RBI tomorrow, a release issued by the state finance department said.
In recent years, the Gujarat government’s public debt has mounted to stand at Rs 86,511 crore as on 31 March, 2009.
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According to the state government, the debt has been utilised for developmental activities of the state and in creation of productive assets.
Besides the staggering public debt, the state government has also extended guarantees on behalf of the government owned entities and various statutory bodies of the state.
However, with stringent financial and administrative measures, the government has reduced its outstanding guarantees from Rs 19,000.99 crore at 2002—03 to Rs 10,340 crore as on March 31.
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Despite mounting debt, the state government has achieved revenue surplus since 2006-07.
According to the finance department release for 2008-09, the government has envisaged revenue surplus of Rs 148 crore and for 2009-10, the government has estimated revenue deficit of Rs 3,913 crore.
“Focused guarantee/debt management has also resulted in improvement in finances of the state PSUs. Active debt management has reduced the interest burden on them from 12 per cent to 8.5 per cent on the present liabilities,” the release said.