Himachal moving towards a debt trap: CAG

Former Chief Minister and Leader of Opposition Prem Kumar Dhumal with other BJP MLAs shout slogans as they walkout of the Himachal Pradesh Vidhan Sabha during the budget session in Shimla on Friday.

The report by the Comptroller and Auditor General that was tabled in the Himachal Pradesh Vidhan Sabha has observed that the small hill State is heading towards a major debt trap withfiscal liabilities reaching ₹ 41,197 crore by the end of 2015-16. The State would have to pay 62% of the debt within the next seven years and the per capita debt reached ₹ 57,642 in 2015-16, up from ₹ 40,904 in 2011-12. There is a big leap of 42% in the past five years.

The State had achieved the target of reduction of revenue deficit to zero and achieved revenue surplus in 2011-12, but it experienced significant deficits during 2012-13 and 2014-15 in all three indicators of revenue deficit, fiscal deficit and primary deficit.

The Opposition condemned the “wasteful expenditure carried out by the incumbent government for unproductive purposes”.

‘Unproductive loans’

The Leader of the Opposition, Prem Kumar Dhumal, on Saturday said the hill State was reeling under a debt of ₹ 45,213.30 crore, which is about 38.3% of the State’s GDP. The Virbhadra Singh government raised loans to the tune of ₹ 13,555 crore in last four years, from 2013 to 2017, for non-productive works. The CAG has made a negative observation on the working of the majority of government enterprises.

Mr. Dhumal maintained that notwithstanding the huge revenue deficit grant of ₹ 40,625 crore by the Union government under the 14th Finance Commission, the weak leadership and governance in the State had failed to catch up with the developmental parameters at the national level.