Maharashtra's debt situation precarious: Mungekar

Member of Planning Commission and a well-known economist Bhalchandra Mungekar feels that the financial condition of all states in the country is precarious with Maharashtra's being "the most dangerous of all".

Interacting with the media here today during a meet-the-press programme at Patrakar Bhawan, Mungekar said the state won't be able to come out of the debt trap unless it prepares a long-term plan for repayment of what all its has borrowed.

The Planning Commission had suggested debt restructuring measures to the finance ministers of states during the Bangalore meeting recently, but Mungekar wondered how much time the states would take to appreciate their position.

Maharashtra with a staggering debt of Rs 1,07,000 crore and an annual interest outgo of Rs 11,000 crore accounts for 50 per cent of the total debt of all states put together, Mungekar noted. He said that debt by itself was not bad, but the state must have a plan for revenue generation.

He also feared that the whopping debt burden could throw the entire planning process of the state awry.

The former vice-chancellor of Mumbai University and former member of Agriculture Commission of the government of India, Mungekar is currently in-charge of six departments in the apex planning body of the country.

These include, education, tribal welfare, social justice and empowerment, labour and employment, youth affairs and sports, and arts and culture.

He has been appointed as chairman of a high-powered standing committee on inter-connected, inter-sectoral issues in tribal welfare and development. This committee, he informed, would be submitting a comprehensive report on tribal development to the Centre in due course.

Elaborating on the key terms of reference of this committee's work, Mungekar said its mandate was to find out the inter-connected causes of tribals' backwardness, land alienation and entitlements and recommend what could be done about it.

Among other aspects of the study would be a review of implementation of tribal sub-plan in the states, study of the causes of violence other than economic backwardness in the tribal-dominated regions and the fragmentation of land.

Importantly, the committee is to study how far the forest protection and conservation laws are responsible for the backwardness of tribals and their land alienation, Mungekar disclosed.

On allocation of financial resources under the central assistance scheme to remove regional imbalances, he said that the commission was seriously discussing the demand raised by progressive states of the country to change the formula of allocation of resources.

Central assistance, at present, is proportionate to the population and backwardness of a state with more funds flowing to areas with more population.

Responding to the issue of agriculture crisis that has wrecked millions of farmers, Mungekar said the Centre and state governments have indeed neglected this sector for the past decade.

He believed huge private and public investment was needed to bail the sector out of the crisis. "This is also necessary for maintaining the growth momentum. Unless we recover in agriculture, we cannot hope to grow at 8 per cent," he pointed out.

Mungekar suggested several steps for adding value to agricultural activities, and said that the current government had begun efforts to give a fillip to agro-economy of the country.

He allayed fears about any drastic change in the process of improving general literacy level in the country and said that the universalisation of education and mid-day meal scheme will not be stopped at any cost. The commission favoured vocationalisation of education by including technical education in the general syllabus, he said.

"We are also making efforts to restructure the financing of higher education," he informed.

Mungekar disclosed that the commission was insisting on a specific policy for culture, thrust on indoor and Olympics sports and a social component plan. He said the civil society had to play a major role in realising goals on the path to development.