CM Bhupesh baghel to PM: Relax credit limit and fiscal deficit

Congress-ruled Chhattisgarh has asked the Central government to keep 6% credit limit of the state and fiscal deficit 5% of the gross state domestic product for the financial assistance of the state.

Chhattisgarh: Chief Minister Bhupesh Baghel has shot off a letter to Prime Minister Narendra Modi demanding that this year the credit limit for the state should be relaxed to 6% and fiscal deficit should be kept at 5% , as a sort of relaxation to distressed people in the state. He also urged him to arrange more financial resources to conduct official and development work in the state.

 In the letter, Baghel stated that due to sudden lockdown and effective steps taken in order to prevention of COVID-19 spread in the state, all the economic-related activities which provide funds to government for effective working is totally shut down from 22 March. This cause great loss of the revenue in the state. And this economic lockdown has most affected the society of daily wages people, labours, small scale shopkeepers and most of the rural area families which is totally dependent on their daily wages. After he added that it is the of reaping crops.

Hence, farmers are helpless in this condition and selling their cultivated crops in just half the rate of the market. As farmers constitute a major part of Chhattisgarh’s overall population, so it’s getting difficult for the state government to take any social and financial measure in order to bring relief to them.  It’s not possible without the corporation and intervention of the central government.

Baghel also mentioned in the letter that all the departments of the state have been allotted budget for the fiscal year 2020-21. Government of India’s Finance Ministry has approved 50% of the net credit limit i.e. Rs 5375 crores to the state for taking market loans in the first nine months of this financial year. This is insufficient for the expenses looking at the current scenario. As the significant decline in revenue collection of the state is expected this year, the state requires relaxation in the net credit limit and the fiscal deficit limit (3% of GSDP) for the state under the provisions of Fiscal Responsibility and Budget Management Act.

Chhattisgarh state has been strictly following financial discipline since the day of formation, and even at present, Chhattisgarh has the least loan pressure (19.2% of GSDP) and least interest payable (7.4% of total revenue collection) in comparison to other states.

Chief Minister concluded the letter by saying during the situation of emergency or disaster, all state requires extra fund and measures to control the situation. Hence, I urged you to grant the relaxation in credit limit up to 6% of the GSDP. Also, the state should be allowed to keep the fiscal deficit up to 5% of the GSDP. These relaxations by Central Government would bring great relief to the state during this difficult time of the pandemic.

Chief Minister expressed hope that the Central Government would consider these genuine demands of the state on a compassionate note, keeping in the mind the difficulties being faced by Chhattisgarh and the entire country because of this pandemic.

Related Articles

Back to top button