Comptroller and Auditor General (CAG) Report on State Public Debt
The CAG report provides a decade-long analysis of the fiscal health of states, focusing on the growth of public debt across 28 states in India from 2013-14 to 2022-23.
Key Findings
- Trebled Debt: The combined public debt increased from Rs 17.57 lakh crore in 2013-14 to Rs 59.60 lakh crore in 2022-23.
- Debt-to-GSDP Ratio: The debt represented 22.96% of the combined Gross State Domestic Product (GSDP) of Rs 2,59,57,705 crore at the end of FY 2022-23, up from 16.66% in 2013-14.
- Highest and Lowest Ratios:
- Highest: Punjab (40.35%), Nagaland (37.15%), West Bengal (33.70%)
- Lowest: Odisha (8.45%), Maharashtra (14.64%), Gujarat (16.37%)
- Debt Liabilities:
- 8 states had public debt liability over 30% of their GSDP
- 6 states had public debt liability under 20%
- 14 states had liabilities between 20-30%
- Comparison to National GDP: The states' total debt in 2022-23 was 22.17% of the country's GDP, which was Rs 2,68,90,473 crore.
Components of Public Debt
- Securities, treasury bills, bonds, etc.
- Loans from State Bank of India and other banks
- Ways and Means Advances (WMA) from Reserve Bank of India
- Loans from financial institutions like LIC and NABARD
Debt as a Percentage
- Debt ranged from 128% to 191% of revenue receipts (2014-15 to 2020-21).
- Debt as a percentage of non-debt receipts ranged from 127% to 190% in the same period.
Golden Rule of Borrowing
The report emphasized borrowing for investment rather than for operational costs. However, 11 states used borrowed funds to finance current expenditures, with notable cases like Andhra Pradesh and Punjab showing very low capital expenditure ratios against net borrowings.