Chandigarh, Oct 17 Punjab Governor Banwarilal Purohit in a letter to Chief Minister Bhagwant Mann on Tuesday accused the state government of diverting capital receipts for undisclosed purposes.
Raising questions on AAP government's fiscal prudence and transparency, Purohit in the letter sought an explanation on "additional borrowing by the government over and above approved by the state Assembly in the Budget".
"Borrowings should ideally be leveraged for the creation of capital assets and not for rolling out populist measures," the Governor said.
"I am asking this question for the sake of transparency. I assure you that once such a comprehensive picture is available, we can approach the government of India for appropriate assistance as the Prime Minister has always expressed his commitment for Punjab, as the welfare of its magnificent people is close to his heart,” he added.
Purohit advised the Chief Minister that all public borrowings should be carefully calibrated so that the youth of Punjab are not imperilled by unsustainable debt.
The letter noted that the state is expected to follow prudent fiscal policies to manage its scarce financial resources.
Earlier, the Governor had written a letter asking the government to explain how they have raised debt of Rs 50,000 crore in the past 18 months.
In his latest letter, Purohit said: "As per the information available, the state government is not managing its fiscal resources in an effective and efficient manner. For instance, in 2022-23, the state government has borrowed Rs 33,886 crore, as against the approved amount of Rs 23,835 crore, which is over Rs 10,000 crore above the amount approved originally by the state Assembly in the Budget. This additional borrowing needs to be explained as, apparently, it has not been utilised for creation of capital assets. This is evident from the fact that the effective capital expenditure dropped by over Rs 1,500 crore -- from a projected Rs 11,375.59 crore to Rs 9,691.53 crore."
"Further, the additional borrowing was not even used to discharge legacy interest obligations, as per the figures projected in the revised estimates in this regard. These, in fact, demonstrate that the total payments defrayed on this account during the year finally stood at Rs 19,905 crore, as against a projection of Rs 20,100 crore in the budgetary estimates for 2022-23," he added.
Quoting the Comptroller and Auditor General (CAG), the Governor said "it indicates that there is substantial variation in the figures furnished by the Chief Minister and the report submitted by the CAG".
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