Srinagar, Jan 17: Similar to previous years, Jammu and Kashmir has accrued a liability of over Rs 7,000 crore in the ongoing fiscal even as experts blame state’s political leadership for not finding a solution to the issue.
Official documents of the finance department reveal that the state is running a liability of Rs 7,531 crore so far this fiscal, a figure close to the annual build-up J&K witnesses every year.
The total liabilities for the state have now swelled up to over Rs 68,000 crore.“The three fiscal parameters–revenue deficit, fiscal deficit and outstanding liability–indicate the extent of overall fiscal balance in the finances of the state government during the specified period. The nature of deficit is an indicator of the prudence of budgetary policy of the state government. Another useful measure of the deficit-base in a state’s fiscal policy is the State’s Own Deficit (SOD),” the documents reveal.
Noted economist, Professor Nisar Ali said the state’s expenditure and revenue system has been “mismanaged”.“The power purchase has been an important factor for swelling liabilities. The GST has further increased the mismanagement between expenditure and tax revenue,” he said.
Prof Ali also blamed J&K’s political leadership for increasing liabilities.“The annual liabilities increase due to power purchases despite the state having huge hydro resources. The state’s leadership has failed to fight for the return of power projects.
“It also depends upon the government of India how it wants to find a solution to this problem,” he added.
Endorsing Prof Ali’s views, a senior official of the finance department said that little or no use of revenue generation avenues, increasing power purchases and bulging expenditure on salaries are the main contributors to the escalating liabilities of the state.“There is a steep rise in salary and pension bills, power deficit, rising interest liabilities, loan repayments, and deficit on account of non-tax revenue,” the official said.