Odisha Government allays concerns about rising debt burden on state finances

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Bhubaneswar: While the loan burden on Odisha’s finances is increasing, the state government has said that there should not be any concern about it as the debt ratios are well within the prudent level.

The Odisha Finance department in its budget document has said that Sustainability of debt stock should not be judged by the absolute amount of borrowing. Rather, it should be seen on the ability of the State to service the debt. Odisha’s Debt/GSDP ratio and Interest payment/Revenue Receipt ratio are well with the prescribed limit under the FRBM act. So there should not be any concern about state’s increasing debt stock.

According to the budget documents, Odisha’s overall debt stock is projected to touch Rs. 1.06 lakh crore by 2020-21 financial year which is 20.1% of state GDP. The debt stock is projected to rise to Rs.1.25 lakh crore by the end of 2021-22 financial year which is 21.3% of state GDP. The debt/SGDP ratio is further estimated to rise to 22.46% by 2023-24.

During the 2021-22 financial year, the state government is estimated to borrow Rs.44,000 crore including Rs.18000 from the open market and Rs.16186 crore from sources like Odisha Mineral Bearing Areas Development Corporation ( OMBADC) and Compensatory fund management and planning authority (CAMPA).

The Odisha government on Monday had presented Rs.1.7 lakh crore budget outlay. Out of this, estimated revenue receipt is estimated at Rs.1.25 lakh crore and rest about 44,400 crore will be collected through loans and other sources.

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