The Comptroller and Auditor General of India (CAG) has reported that the state’s outstanding debt and fiscal deficit for the 2021-22 financial year have exceeded the prescribed limits of GSDP. The CAG report was presented in the Assembly on the last day of the monsoon session. It revealed that the public debt was above the limit of 25% of GSDP, with the state’s outstanding debt amounting to 27.40% of GSDP.
Additionally, the fiscal deficit of the state surpassed the prescribed 3% of GSDP. The report stated that the fiscal deficit of Rs 46,639 crore accounted for 4.06% of GSDP for 2021-22. The prescribed limit for fiscal deficit during a financial year is 3%.
The report also highlighted that the Telangana government had a revenue deficit of Rs 9,335 crore (0.81% of GDP), emphasizing that the state should have maintained a revenue surplus.
The increased state debt burden and fiscal deficit can be attributed to various factors, according to finance officials. The government had to obtain significant loans from financial institutions to carry out various projects and implement welfare schemes. Furthermore, the impact of the COVID-19 pandemic in the 2021-22 financial year resulted in a decrease in revenue generated from different sources.
The state government managed to generate revenue of Rs 1.27 lakh crore, falling short of the target of Rs 1.76 lakh crore by 28%. The total revenue receipts, including grants, capital receipts, and borrowings, amounted to Rs 1.74 lakh crore, whereas the target was set at Rs 2.21 lakh crore. Therefore, the government experienced a deficit of Rs 50,000 crore in the target for the 2021-22 financial year.
According to the CAG report, as of March 31, 2022, the state had a revenue deficit of Rs 9,335 crore and a fiscal deficit of Rs 46,639 crore. The fiscal deficit was covered through borrowings and other liabilities (Public Debt of Rs 42,936 crore), the Public Account (Rs 3,773 crore), and the cash balance (Rs -70 crore). Approximately 50% of the state government’s revenue receipts (Rs 1,27,468 crore) were allocated to committed expenditures such as salaries (Rs 30,375 crore), interest payments (Rs 19,161 crore), and pensions (Rs 14,025 crore).
