Gujarat's public debt, which stands at a little over Rs2 lakh crore at present, is projected to close in on the Rs3 lakh crore mark within the next three years. Budget documents tabled in the state assembly on Tuesday show that the state's public debt was Rs1.99 lakh crore at the end of 2016-17, and is projected to exceed Rs2.17 lakh crore at the end of the current financial year. The state's medium-term fiscal policy statement projects the state's debt at Rs2.38 lakh crore in 2018-19, Rs2.66 lakh crore in 2019-20, and Rs2.96 lakh crore in 2020-21. However, the debt could cross Rs3 lakh crore in 2020-21 as budget projections often tend to go wrong. Even for the current year, the debt level was pegged at Rs2.14 lakh crore, but was revised to Rs2.17 lakh crore. A senior finance department official said that the debt projections should not be seen in isolation but as a percentage of the GSDP. "We as a state are doing very well in terms of financial stability and fiscal discipline. Our revenues are buoyant and fiscal deficit has fallen. The state's public debt is going up in absolute terms, but as a percentage of GSDP, and which is the right indicator to be considered, it is declining," the official said, requesting anonymity. For 2017-18, the state's debt as a percentage of GSDP is estimated at 16.66. The policy statement shows the figure declining to 15.96%, 15.73% and 15.44% in 2018-19, 2019-20, and 2020-21 respectively. The state's fiscal deficit, which fell to a record low of 1.42% of GSDP last year and is pegged at 1.66% for this year, is, however, expected to rise in absolute term as well as percentage of GSDP in the coming three years. In absolute terms, the fiscal deficit is projected to go up from Rs21,948 crore in 2017-18 to Rs43,225 crore in 2020-21. As percentage of GSDP, the fiscal deficit is seen at 1.71% in 2018-19, and 2.25% in 2019-20 and 2020-21, according to the budget document. "As per Fiscal Responsibility and Budget Management (FRBM) Act, the state's fiscal deficit should be not more than 3% of GSDP. However, we have managed to stick to the threshold, and by some distance. Even though fiscal deficit will go up in the next three years, it is way below the limit," said an official.

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