Cash-strapped West Bengal passes bill in House to increase borrowing capacity – The New Indian Express

Express press service

KOLKATA: Burdened by a debt of Rs 70,000 crore, the West Bengal government on Wednesday passed a bill in the Assembly to boost its borrowing capacity. The decision to amend the West Bengal Fiscal Responsibility and Fiscal Management Act, 2010 was initiated following the Centre’s suspension of the release of funds under the MGNREGA scheme. The Mamata Banerjee-led government is now desperate to keep the flow of funds into beneficiary accounts intact ahead of panchayat elections next year.

Earlier, the Union Finance Ministry had decided to set the net government borrowing ceiling at 3.5% of the state gross domestic product (GSDP) for 2022-23, and a capacity to additional loan of 0.5% from the GSDP.

“The state is going through an acute financial crisis. In recent meetings, the CM has asked bureaucrats to find ways to generate inputs. The government has no way out but to borrow more money to keep welfare schemes alive,” one bureaucrat said.

The Union government had previously ordered the state to recover money allegedly stolen by panchayat and zila parishad officials, and the state had taken steps to follow the directive.
Revealing the poor image of the cash-strapped and industry-starved state, recent statistics released by the central Ministry of Industry and Business show that from January to July, investments worth Rs 1.17 lakh crore entered India, from which West Bengal got only Rs 1,663 crore. State revenue comes primarily from stamps and registration fees, state goods and services tax, gasoline sales tax, and state excise duties.

KOLKATA: Burdened by a debt of Rs 70,000 crore, the West Bengal government on Wednesday passed a bill in the Assembly to boost its borrowing capacity. The decision to amend the West Bengal Fiscal Responsibility and Fiscal Management Act, 2010 was initiated following the Centre’s suspension of the release of funds under the MGNREGA scheme. The Mamata Banerjee-led government is now desperate to keep the flow of funds into beneficiary accounts intact ahead of panchayat elections next year. Earlier, the Union Finance Ministry had decided to set the net government borrowing ceiling at 3.5% of the state gross domestic product (GSDP) for 2022-23, and a capacity to additional loan of 0.5% from the GSDP. “The state is going through an acute financial crisis. In recent meetings, the CM has asked bureaucrats to find ways to generate inputs. The government has no way out but to borrow more money to keep welfare schemes alive,” one bureaucrat said. The Union government had previously ordered the state to recover money allegedly stolen by panchayat and zila parishad officials, and the state had taken steps to follow the directive. Revealing the poor image of the cash-strapped and industry-starved state, recent statistics released by the central Ministry of Industry and Business show that from January to July, investments worth Rs 1.17 lakh crore entered India, from which West Bengal got only Rs 1,663 crore. State revenue comes primarily from stamps and registration fees, state goods and services tax, gasoline sales tax, and state excise duties.

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