MP govt took Rs 5,000 crore loan during model code; state debt now Rs 3.5 lakh cr

  • | Saturday | 2nd December, 2023

BHOPAL: The Madhya Pradesh government has taken an additional loan of Rs 5,000 crore since October 9, when the model code of conduct came into force. The new government to be formed after counting of votes on December 3 will inherit a debt of at least Rs 3.5 lakh crore.On March 31, 2023, MPs debt stood at over Rs 3.3 lakh crore. In the past nine months, Rs 25,000 crore more has been added to the burden.A whopping Rs 12,000 crore loan was taken in September alone — two months before elections.On October 18, the government took a loan of Rs 1,000 crore. Eight days later, it took another loan of Rs 2,000 crore and on November 22, five days after voting, an additional Rs 2,000 crore.Officials said that there is no bar on taking loans when the model code is in force. In previous years, the loan would be generally taken in the last quarter, but this year it was taken in breaks all round the year. With four more months left for the fiscal, MPs loan will rise, an official said.The governments pre-poll announcements and schemes in the run-up to the elections are estimated to increase expenditure by at least 10%, say sources. The next government — whether BJP or Congress — will have a hard time managing the finances.The MP governments average monthly expenses are around Rs 22,000 crore, and likely to get close to Rs 25,000 crore due to the pre-poll announcements. Any other largesse will add to it.In the first supplementary budget of Rs 26816.6 crore passed in the assembly on July 13, Rs 762 crore was set aside to pay the interest of the new market loans taken by the government.Officials said, consent of the central government is obtained for loan. Based on the financial position there was a limit set to the extent of which a state government can take loan.The loans taken by the government are utilized for financing productive development programmes and projects to be implemented in the state. It mainly bears the cost of development schemes.Loans taken from the Government of India and from other sources were mainly utilized for development of the state and for the creation of remunerative assets such as construction of irrigation dams, improvement of transport services, grant of loans to third parties like cultivators, local bodies, loan to power generation, power transmission among others.

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