Chandigarh, January 25
After tackling the issue of subsidies as well as drawing up a blueprint to mobilise an additional Rs 4,000 crore, Punjab will now seek a financial restructuring of its debt burden from the Centre.
Though Punjab has been demanding financial restructuring for some time now, its pleas were not heard by the Finance Commission that wanted it to change its policies on subsidies as well as mobilise fresh resources on its own. With the Sukhbir-Kalia report addressing both issues, the state now has the required moral stand to take up the issue of financial restructuring with the Centre.
Chief Secretary SC Agarwal said the report had opened up access to more central funds particularly under the Jawaharlal Nehru Urban Renewal Mission (JNURM) and Accelerated Irrigation Benefits Programme (AIBP). He said the state was likely to now get a few thousand crores under both schemes in the next two to three years. He said with more money to spend in its hands, the state’s standing with the Centre was likely to improve and a financial restructuring exercise could be initiated.
Finance Minister Manpreet Singh Badal said the total state debt by the end of this financial year would touch Rs 63,000 crore. The interest burden annually is around Rs 6,000 crore. He said the state had taken up the issue of restructuring of this debt with Finance Commission Chairman Vijay Kelkar who had said that if the commission did help the state, it would be with certain conditions.
Manpreet Badal said the state had in its representation to the Finance Commission asked for its help on three issues. “We had asked that part of the debt incurred by the state (Rs 28,000 crore) during the period of militancy be waived besides urging that it be restructured for another 30 years.” He said besides this the state had demanded that as part of the debt came at
an interest rate of 10 to 11 per cent, the same be reduced to 7 to 8 per cent. He said all three options could be exercised at one go. Sources said though the Centre was under no obligation to restructure the state debt, it could intervene to help the state, depending on how the latter put up its case.
The sources said besides access to central funds over a period of two to three years, the state would now also be able to collect Rs 200 to Rs 300 crore immediately through the Local Government Department and Rs 400 crore through the Irrigation Department. Money is also likely to be collected immediately through way of stamp duty though VAT collections will only be reflected after the April returns.
These collections are likely to give a fillip to central schemes that were not being implemented due to the failure of the state government to put in its share besides galvanising the state bureaucracy, which has been demoralised due to the perpetual financial crunch.
Meanwhile the state government is likely to notify the recommendations made by the Sukhbir-Kalia committee within one week with those recommendations needing a change in law also being reviewed. These recommendations are likely to be amended through a Cabinet decision and then put up before the Assembly.
