The Hindu : Other States / Madhya Pradesh News : M.P. Minister `corrects' Opposition Leader

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Thursday, Jun 16, 2005

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M.P. Minister `corrects' Opposition Leader

Staff Correspondent

Figures given by Jamuna Devi on borrowings are totally incorrect and misleading, says Raghavji

BHOPAL: The Madhya Pradesh Finance Minister, Raghavji, has described as "misleading" the leader of the Opposition in the State Assembly, Jamuna Devi's allegation that the State's finances were being mismanaged and the Government had borrowed heavily during the last 16 months.

In a statement here, Ms. Devi had said that the Madhya Pradesh Government had borrowed Rs. 13, 433 crores in the last 16 months. Ms. Devi pointed out in her statement that a gazette notification issued on June 9 and signed by the State Finance Secretary clearly said that the State Government's debit burden on March 31, 2005, was Rs. 41,359.50 crores. On the basis of this notification, she described as false the reply given by the State Finance Minister in the Assembly on March 1, especially his assertion that the Government's debt burden was Rs. 33,360 crores.

In his rejoinder to Ms. Devi, the State Finance Minister has said "it is not correct that the State Government had borrowed Rs. 13, 433 crores in the last 16 months." Setting the record straight, Mr. Raghavji said that on November 30, 2003, the State Government had inherited a public debt of Rs. 25, 115 crores.

The borrowings increased by Rs. 8, 247 crores taking the total debt burden to Rs. 33, 360 crores by March 2005. Of this amount, Rs. 2000 crores was for the State Electricity Board to be repaid to the Rural Electrification Corporation.

The State Government had taken up this liability that was supposed to have been honoured before November 30, 2003, Mr. Raghavji said, adding that if this amount is reduced from the debt burden the additional loan borrowed in the last 16 months comes to Rs. 6, 247 crores.

Borrowing inevitable

The Finance Minister emphasised that borrowing is inevitable for development and was particularly unavoidable given the "pitiable scenario with regard to roads, electricity and irrigation inherited from the previous State Government."

He said that the Plan expenditure during the present regime increased from Rs. 5, 600 crores in 2003-2004 to Rs. 6, 300 crores in 2004-2005. The capital expenditure also increased from Rs. 2, 679 crores to Rs. 5, 346 crores in the same period, he said, asserting that this clearly showed that the borrowings had not been utilised to meet the day to day expenditure but on infrastructure development.

He also pointed out these loans were taken with the permission of the Government of India and the Reserve Bank of India. Ridiculing Ms. Devi's allegation of financial mismanagement, Mr. Raghavji said the State Government did not go for overdraft even for a single day in the last 16 months.

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M.P. Minister `corrects' Opposition Leader