​​​​​THIRUVANANTHAPURAM: The public debt of the state is skyrocketing. As of now, the state’s public debt stands at Rs 3.25 lakh crore. This huge figure could be attributed to Covid lockdown and shortage in tax income and reduction in investments across various development projects in the state. If the KIFB’s Rs 63,000 is added with this, the public debt would amount to Rs four lakh crore. Thus every Keralite will have a liability of Rs one lakh.

Last year, Kerala’s debt was Rs 38,189 crore. That is every month the state had to borrow atleast 3,000 crores. Between 2011-16, when UDF was in power, about Rs 1,000 crore was borrowed every month. During the first Pinarayi government, that figure increased to Rs 2,000 crore and during the covid period is further hiked to Rs 3,000 crore.

This much amount of money was borrowed to cover the revenue deficit which occurs due to low revenue and high expenditure. Up to five per cent of the total income can be borrowed in this manner. When the limit is reached, it is not possible to borrow further especially for development purposes. The relevance of KIIFB, which can borrow outside the budget comes here.

State Public Debt

In 2011, when UDF comes to power the public debt is Rs 78,673.24 crore

In 2016, when the LDF forms government public debt of the state is Rs 1,57,370 crore

In 2021, when LDF again comes to power it further increased to Rs 3,27,654.70 crore

If the debt liability increases

The state’s borrowing ratings inside and outside the country will go down. Interest rates on loans will go up. The amount received will be reduced. Annual repayment liability will increase further and the state’s total income will come down.

Will put on efforts to increase income by taking money directly to the hands of people. Expenditure will be reduced. Will try to get more central grants and other forms of financial assistance from the centre and thus save the state from the debt trap.

-Finance Minister K.N. Balagopal