The finance minister has given go ahead under the Fiscal Responsibility and Budget Management Act (FRBM).
Mumbai: The Maharashtra government can avail more loans to complete its infrastructure projects as Union finance minister Arun Jaitley has given a go ahead under the Fiscal Responsibility and Budget Management Act (FRBM). Now, the state government can increase the fiscal deficit from 2.7 per cent to 3.3 per cent. This will give the state capacity to borrow additional Rs 11,000 crore to Rs 12,000 crore to carry out its infrastructure projects.
The state has undertaken infrastructure projects worth Rs 1 lakh crore including metro, monorails, Mumbai Trans Harbour Sealink and coastal road. The state government needs more borrowing to complete the projects. However, the Maharashtra government has breached its upper limit of borrowing this year as its debt stock (total debt owned) reached the level of Rs 4.13 lakh crore. The debt stock was Rs 2.69 lakh crore during the Congress-Nationalist Congress Party (NCP) regime which has doubled now. Hence, chief minister Devendra Fadnavis had requested Mr Jaitley to increase the outer borrowing limit.
“We have doing infrastructure projects worth Rs 1 lakh crore and need more borrowing capacity. The finance minister has given go ahead under the Fiscal Responsibility and Budget Management Act (FRBM). Now, the fiscal deficit has increased from 2.7 per cent to 3.3 per cent allowing to the state to borrow Rs 11,000 crore to Rs 12,000 crore,” an official from the finance department said.
The upper limit of the borrowing should be less than 10 per cent of the revenue collected. However, it crossed the limit in 2015-16 and reached to 13.93 per cent, the official figures from the government showed. Revenue deficit numbers are alarming this year. The revenue deficit Rs 3,644 crore was predicted in 2016-17 in the budget, however, the actual deficit this year would cross Rs 14,377 crore, as per the information sought from the finance department.