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State governments are borrowing less from the market, aiming for fiscal prudence as suggested by the Finance Commission, even as Covid-related economic dislocations squeeze their existing revenue streams.
Market borrowings by states thus far in financial year 2021-22 (FY22) is 11 per cent lesser than last year. In fact, it is 12 per cent lower even than what they had planned to borrow according to their calendar for this year, according to CARE Ratings.
So far, 25 states and one Union territory (UT) have raised a cumulative Rs 2.92 trillion, as against Rs 3.27 trillion borrowed by 27 states and two UTs in the comparable period last fiscal.
