High outstanding debt to be focus of CM's meet with Finance Commission

Kolkata: The Bengal government has presented the issue of the state having the high outstanding debt over the past 18 consistent fiscals before the Finance Commission.

This comes at a time when Chief Minister Mamata Banerjee is set to have a one-to-one meeting with N K Singh, chairman of the fifteenth Finance Commission, during its scheduled visit to Bengal from July 16 to 18. The Chief Minister's meeting with the chairman will take place on July 17, before the state government's formal presentation.

According to a Press communique of the state government, the Commission has taken note of various aspects of the state's finance from the Accountant General of Bengal in Delhi, before its visit to the state.

It has been stated that despite numerous achievements of Bengal in socio-economic sectors, the state faces numerous challenges for its huge debt liabilities and payment of interest at a high rate.

Moreover, "the fiscal picture in Bengal is characterised by a high Debt to Gross State Domestic Product (GSDP) ratio and a low own tax revenue-GSDP ratio. Bengal has consistently had high outstanding debt over the period between 2000-01 to 2017-18 fiscals."

Stating the present situation due to the "historical low base of capital expenditure", the state government has stated that "Bengal's ratio of development expenditure to GSDP and capital outlay to GSDP has been one of the lowest among the general category states." This comes when "the Social Sector Expenditure to GSDP ratio has been higher than the all state average".

The state government has also stated about the Limited Revenue Raising Capacity due to large informal economy and sectoral composition of state's GSDP. More importantly, the contribution of agriculture is 21.54 percent, when the all India average is 15.40 percent.

The issues of the huge population density in the state and 19.98 percent of the total population being below the poverty line have also come up.

The state government has also mentioned its achievements in socio-economic areas and it includes Open Defecation Free districts, of which Nadia is the first one in the country. The improvement in the health sector includes 96 percent institutional deliveries, while in the educational sector, Bengal stands first in terms of enrollment of students and disbursement of scholarships.

The state has also received the Krishi Karman Award for five consecutive years for the development in the agriculture sector. At the same time, there has also been electrification of 99.81 percent and Bengal is also among the top ranking states in Ease of Doing Business.

It may be mentioned that the state government will be giving a detailed presentation before the commission during the meeting at Nabanna Sabhaghar and there will be thorough discussion over the issues with the Finance Commission.

Besides the meeting, the Finance Commission will also be visiting the IT Park in New Town, Madhyamgram Municipality and Kemia Khamarpara Gram Panchayat.

The Finance Commission, led by its chairman N K Singh and members including Shaktikanta Das, Dr Anoop Singh, Dr Ashok Lahiri, Dr Ramesh Chand and Secretary Arvind Mehta will also meet with leaders of different political parties, representatives of trade and industry.