Tamil Nadu’s market borrowings in the first nine months of the 2021-22 financial year have been about 17% lower than last year, amid improving revenue.
The State has borrowed ₹52,000 crore in April-December 2021, compared with ₹63,000 crore in the same period during the previous financial year. The borrowings have been done through the auction of State government securities or State development loans.
Tamil Nadu’s revenue has rebounded after the second wave of COVID-19. Its total revenue receipts increased about 22% to ₹1,18,992.48 crore in April-November 2021, from ₹97,635.78 crore in the same period last year. The total revenue receipts collected so far amounts to 58.76% of the ₹2,02,495.89 crore estimated in the revised Budget for 2021-22, according to the unaudited provisional figures from the Comptroller and Auditor-General.
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The total revenue receipts include tax revenue, non-tax revenue, grants-in-aid and contributions. Tax revenue comes from the State’s own direct sources like the State GST, stamps and registration fees, land revenue, tax on petroleum products and revenue from liquor sales and the State’s share in the Central and other taxes and duties.
The revenue receipts got a boost with the Union government devolving ₹3,878.38 crore to the State in November last. The State also got ₹8,095 crore in back-to-back GST compensation loan from the Union government for 2021-22. Tamil Nadu’s revenue expenditure stood at ₹1,26,862.35 crore in April-November 2021.
As a result, the revenue deficit (which implies revenue expenditure which is higher than revenue receipts) stood at about ₹ 7,869.87 crore as in November 2021, lower than ₹10,126.14 crore posted in October 2021.
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For 2021-22, Tamil Nadu has put its revenue deficit at ₹58,692.68 crore. But Finance Minister Palanivel Thiaga Rajan has said it will be reduced. Tamil Nadu has recently announced fresh restrictions amid a sharp increase in COVID-19 cases, including those of the Omicron variant of the novel coronavirus. Any more stringent restrictions will impact revenue collection, resulting in more borrowings. The State’s fiscal deficit (the difference between total revenue and expenditure) stood at ₹30,051.71 crore as in November 2021.
Maharashtra, Tamil Nadu, West Bengal, Uttar Pradesh, Andhra Pradesh, Rajasthan, and Telangana are the top borrowing States so far this fiscal, accounting for 65% of the total borrowings, according to CareEdge Ratings.
Tamil Nadu will raise ₹1,000 crore on Tuesday through re-issue of State development loans with a tenure of 24 years.