Amritsar: Punjab, which was once the richest state in India, is today facing a serious economic crisis due to the bad policies of the government. Economists Lakhwinder Singh, Sukhwinder Singh, and Kesar Singh Bhangu have written a letter to the Punjab government suggesting the creation of a Debt Relief Fund (DRF) in view of the state's condition. Along with this, economists have also instructed Chief Minister Bhagwant Mann to ask for public donations to get out of the debt trap.
According to media reports, economist Lakhwinder Singh is working as a visiting professor at the Institute of Human Development (IHD) in New Delhi. Whereas, Sukhwinder Singh is a former professor and advisor to the Punjab Finance Commission in Chandigarh and Kesar Singh Bhangu has been a professor of economics at Punjab University. That is, all these three stalwarts have good knowledge of the economy and policies related to it. These three economists have advised the Aam Aadmi Party (AAP) government of Punjab to get out of the debt quagmire in research titled 'Fiscal Policy Under Siege: Strategy for Making Punjab Debt Free' on 11 February 2023. The report asked the Bhagwant Mann government to seek help from other political parties in the state and ask for a relief package from the Centre.
The economists have written in their letter, 'We suggest to the government that one of the many existing options is to set up a debt relief fund and urge people belonging to Punjab to contribute money to it. This fund will be used only to reduce the debt burden of Punjab. All over the world, Punjabis are known to be helpful in nature and giving charity. This cultural feature of Punjabis will prove to be very helpful in dealing with debt. Economic experts say that during the last 3 years, the state government took a loan of about Rs 35,201.87 crore per year. For this, it pays an interest of Rs 18,209.8 crore, as well as a total of Rs 32,467.78 crore, including Rs 14,257.98 crore to cover the principal amount, to the state government.
According to the report, the fiscal strategy of the Punjab government has collapsed. Punjab lacks the capacity to invest new capital. According to the Reserve Bank of India (RBI) data, the amount borrowed by the Punjab government from different sources is 53.3 percent of its Gross State Domestic Product (GSDP). Economists have told that the debt on the state started increasing at the rate of 22.85 percent in the financial year 2015-16 and 40.80 percent in the financial year 2016-17. It was alarming and it has been increasing since then and is increasing at an average rate of more than 9 percent every year. The present government (Baghwant Mann government) is also taking loans like the previous governments.
Economists have said that the government will increase spending without raising the necessary level of revenue due to existing obligations, the promise of jobs in the public sector, transfer payments, and subsidies. The economists reiterated that the government should set up a panel to find practical solutions to halve the debt burden in the near future and focus on making Punjab free from the debt trap. Economists also suggested to the government that the government can issue bonds to immediately remove the burden of increasing debt. Also can take help from well-known intellectuals of Punjab, and leaders of other political parties and can bring this issue (of the loan) before the central government for a relief package. He said that against the estimated revenue deficit of Rs 12,553.80 crore for the year 2022-2023, the current government (AAP government) has reduced the revenue deficit to Rs 15,348.
Let us tell you that since coming to power, in 11 months, the AAP government has taken a loan of more than Rs 35,000 crore. An estimated Rs 22,000 crore will be spent from the state exchequer in this financial year due to subsidy on electricity. Hence, Punjab had to take a loan of Rs 500 crore to pay the salaries of its employees for the last month. The situation worsened after the Punjab government gave 300 units of free electricity to the people of the state. The state government is yet to take a decision on free bus service for women as per its election promise. Despite this financial crunch, Punjab's Women and Child Welfare Minister Dr. Baljit Kaur is promising Rs 1,000 per month to women. This promise was made by AAP during the Punjab assembly elections. However, keeping in view the economic condition of the state, AAP is finding it extremely difficult to fulfill these promises.
Newly married woman's body found hanging, investigation started
'Ham Ghode Ke Maze Le Rahe The...', Says minister as he couldn't control horse
