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Pondy fiscal deficit goes up by Rs. 23 crores

Staff Reporter

Increase due to a rise in plan and non-plan revenue expenditure: CAG report

PONDICHERRY: The fiscal deficit of the Union Territory has increased from Rs. 113 crores in 2002-03 to Rs. 136 crores in 2003-04, according to Comptroller and Auditor-General (CAG) report for the year ended 31 March 2004.

The report, placed before the Assembly on Monday, says the increase in the fiscal deficit is due to a rise in plan and non-plan revenue expenditure. The overall revenue expenditure of the Government grew from Rs. 845.57 crores in 1999-2000 to Rs. 1,293 crores in 2003-04. Of this, 74 percent was under non-plan.

Fiscal liabilities grew from Rs. 698.35 crores in 1999-2000 to Rs. 1,312.31 crores in 2003-04. The interest rate on fiscal liabilities is higher than the growth rate of Gross State Domestic Product (GSDP) in 2001-04, `indicating poor debt sustainability'.

For every one per cent increase in GSDP, the fiscal liabilities of the UT Government increased by nearly 2.5 percent in 1999-2004. "During 2003-04, the revenue surplus and the net available borrowed funds contributed to increase in cash balance by Rs 62.78 crores, indicating unnecessary borrowing to this extent and creation of the consequent liability thereon".

The report said, "while the Government was raising high- cost borrowings from the Government of India, its investments in Government companies and cooperative institutions fetched insignificant return." The total investment in Government companies went up to Rs 437.81 crores as on March 31 2004 from Rs 421.70 crores during the previous year.

Five Government companies earned an aggregate profit of Rs. 22.98 crores and four companies incurred an aggregate loss of Rs 28.76 crores. Of the five profits earning companies, only three companies declared dividend of Rs. 2.41 crores for 2003-04.

The accumulated losses of companies aggregated to Rs 207.79 crores, which exceeded their paid-up capital of Rs. 202.39 crores.

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