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| Orissa avoids open market borrowing for third year |
| Bishnu Dash / Kolkata/ Bhubaneswar Jun 01, 2009, 00:51 IST |
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For the third year in a row, the Orissa government managed to meet its expenditure obligations envisaged in the state budget without resorting to any open market borrowing. It is now clubbed with Chhattisgarh which also did not resort to market borrowing in 2008-09.
While the state budget projected an open market borrowing of Rs 650 crore for 2008-09, due to the higher net repayment, the open market borrowing was negative during the year.
Earlier, in 2006-07 and 2007-08, the state government did not resort to such borrowing even though the state budget projected open market borrowings of Rs 1,084.58 crore in 2006-07 and Rs 1,639.08 crore in 2007-08.Through prudent fiscal management, the state has been able to dispense with the market borrowing from 2006-07 to 2008-09, sources said. Net internal loans of the government which were projected at Rs 742 crore in the state budget for 2008-09, was lower by 48.44 per cent at Rs 359.48 crore. Similarly, the net loans and advances from the Central government which was projected at Rs 1,465 crore in 2008-09 was significantly lower at Rs 75.25 crore.
“We have some sources like the General Provident Fund (GPF) and National Savings Scheme Fund (NSSF) where the borrowing is mandatory. There was no necessity for resorting to open market borrowing during these years”, an official of the state finance department said.
Due to the swapping and pre-payment of the high cost debts, the Orissa government was able to reduce its outstanding debt in 2007-08 for the first time after 22 years. The outstanding debt declined by Rs 1,373.93 crore to Rs 35,875 crore by March 31, 2008 (about 3.68 per cent). Meanwhile, the collection of tax and non-tax revenue at Rs 10,996.04 crore during the last fiscal exceeded the budget target of Rs 9,407.26 crore by 16.89 per cent. This was also 15.63 percent higher than the collection in 2007-08.
The revenue expenditure (in the non-plan account) during the fiscal was lower at Rs 16,154 crore, compared to the budget estimates of Rs 17,338 crore. Similarly, revenue expenditure (plan account) was Rs 5,210 crore compared to the budget estimates of Rs 5,367crore.
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