State not to resort to open market borrowing till Jan

The Orissa government will not resort to open market borrowing till January 2010. It has already indicated to the Reserve Bank of India (RBI) that it will not resort to open market borrowing till January next year after which it will review the fiscal position of the state.

Starting from 2006-07 the state government managed to meet its expenditure obligations envisaged in the state budget without resorting to any open market borrowings for three years in a row. Prudent public debt management by the state financial planners has helped the Orissa government to reduce the aggregate debt stock during 2009-10, sources said.

The loan outstanding (excluding the loans availed from GPF) by March 2009 ((provisional) was Rs 25,246.25 crore compared to Rs 25,587.2 crore by March 2008. The net reduction in debt in 2008-09 was Rs 340.95 crore as the repayment of loan at Rs 1492.61 crore was higher than the receipt of loans at Rs 1151.66 crore.

Continuing the trend during the last fiscal, the receipt of loans was Rs 484.9 crore with the repayment being Rs 744.93 crore. However, there was marginal increase in the total outstanding debt (including the GPF loan) in 2009-10 compared to 2008-09, sources added.

The loan outstanding by March 2009 was Rs 36430.54 crore, which included Rs Rs 8476.1 crore loan availed from Government of India (GoI), Rs 6822.27 crore availed from National Small Savings Fund (NSSF) and Rs 1109.64 crore loan from National Bank for Agriculture and Rural Development (Nabard). This is about Rs 119 crore higher than the Rs 36,311.61 crore debt by March 2008, sources added.

Lower growth in the overall debt, including the loans availed from GPF was possible due to negative growth in the open market borrowing by about Rs 520 crore and Life Insurance Corporation (LIC) by about Rs 2.85 crore.