Tribune News Service
Shimla, October 12
The Rs 450-crore special interest free 50-year-loan to Himachal Pradesh by the Union Finance Ministry could prove to be a major breather for the sagging economy which is already under a huge debt trap, with little revenue generating avenues.
Debt trap crosses Rs 54,000 crore
- Himachal’s debt trap has already crossed Rs54,000 crore and the state has had to practically manage with loans for most of its development works and to meet the hefty salary and pensionary financial burden. The state has raised loans of Rs5,067 crore between January 2019 to March 2020 and Rs5,677 crore since April to July 2020
- The help from the Centre has come at a time when the bimonthly GST compensation to the state has been delayed
The announcement by Union Finance Minister Nirmala Sitharaman, providing additional Rs 25,000 crore as capital expenditure for giving a boost to economic growth today has come as a major relief to the hill states. The fact that Himachal is amongst the top beneficiary states in the country is a clear indication of Union Minister of State for Finance Anurag Thakur’s endeavour to provide maximum possible allocation to his home state of Himachal.
“The allocation under the leadership of Prime Minister Narendra Modi bats vigorously to develop Trans Himalayan Range with capital expenditure as special assistance for Himachal Pradesh, Uttarakhand and northeastern states,” said Thakur. He added that never before has Himachal received this kind of allocation and that too at a time when there is revenue shortfall due to pandemic.
The assistance will go a long way in generating employment, creating self-employment opportunities and providing strength to local businesses which have been hit severely by the Covid pandemic. The allocation is expected to help states to incur extra capital expenditure that will hopefully lead to a demand situation. The help from the Centre has come at a time when the bimonthly GST compensation to the state has been delayed.
Himachal, besides other eight northeastern states, has been given a total of Rs 2,500 crore, with Himachal getting a quantum amount. The funds will go a long way in infrastructure development like construction of roads, water supply and urban development.
The 69 national highway projects announced by the Centre for Himachal are languishing for want of funds despite good connectivity being a major pre-requisite for tourism promotion, a major revenue generating sector for the hill state.
Himachal’s debt trap has already crossed Rs 54,000 crore and the state has had to practically manage with loans for most of its development works and to meet the hefty salary and pensionary financial burden. The state has raised loans of Rs 5,067 crore between January 2019 to March 2020 and Rs 5,677 crore since April to July 2020.
The state is expecting a Rs 1628 crore GST compensation from the Centre.
The state government has also decided to make optimum utilization of the Rs 5156.25 crore unspent money lying with various departments. The main revenue generating sectors of tourism and power have taken a severe beating during the Covid pandemic and it will take some time for them get back on track.
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