Days after Punjab Governor Banwarilal Purohit asked him to explain the Rs 50,000 crore debt taken by the state government during the Aam Aadmi Party (AAP) regime, Chief Minister Bhagwant Mann on Tuesday said the state government borrowed Rs 47,109 crore in the past 18 months.
In a letter to the governor, Mann said of the Rs 47,107 crore loans raised by the AAP Government between April 2022 and August 2023, over 57 per cent had been used to repay the interest on loans inherited by the current government from the previous state governments.
The CM said during the tenure of the state government, the net addition to the state’s debt had been Rs 47,107.6 Crore. This includes market loans, loans from NABARD, externally aided project loans and long-term loan under special assistance for the creation of capital assets as permitted by the Centre.
Mann said during his tenure as CM, the state government has used both debt and own revenue resources to fund organisations, and schemes ignored by predecessors, utilised the new debt to create capital assets and undertake developmental works.
Referring to the government as “your government”, the CM said he is committed to honouring the state’s rightful liabilities and servicing the debt in a timely manner.
“I am happy to share that your government has invested in the Sinking Fund a total of Rs 4,000 crore since April 1, 2022, while the total accumulation by previous governments just stood at Rs 2,988 crore. This fund is aimed at alleviating some of the debt pressure of the state in the future,” he said.
On 22 September, after Chief Minister Bhagwant Mann asked the Punjab Governor to take up the state’s case for getting Rural Development Fund (RDF) from the Centre, the Governor had sought information on the increase of over Rs 50 thousand crore debt on the state during the tenure of the AAP government.
“To facilitate a more informed approach in addressing the RDF matter,” the Governor had asked the CM to provide detailed information regarding the “utilisation of this substantial amount of debt”.