Fiscal imbalance in the State – CAG

19 Feb 2013
Thiruvananthapuram

Increasing revenue and fiscal deficits continues to show growing fiscal imbalance in the State, according to the Comptroller and Auditor General (CAG) of India report on the State Finances for the year that ended March 31, 2012. The maturity profile of debt indicated that the State would have to repay 49.6 per cent during the next one to seven years, says the CAG report, tabled in the Assembly on Monday.

There has been a decline in net availability of funds from borrowings, since a large portion is used for debt servicing. During 2011-12, the State borrowed Rs.8,880 crore from the market but net availability was only Rs.4,426 crore. A larger part could not be used for developmental activities and was instead used for non-developmental purposes.

During the year, capital expenditure had gone up by 14.54 per cent to Rs.3,853 crore and accounted for 8 per cent of the total expenditure of the State. Tax and non-tax revenue has looked up. But revenue receipts, as a percentage of gross state domestic product (GSDP), declined. This indicated that the growth in tax revenue had not kept pace with that of gross state domestic product, the report said.

Source– http://www.thehindu.com/news/national/kerala/cag-finds-growing-fiscal-imbalance/article4428570.ece?ref=sliderNews

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