MP govt loosens purse strings, has cash crunch ended?
The acute cash crunch being faced by MP government since September this year seems to be over, with chief minister Shivraj Singh Chouhan announcing a slew of fund allocations during his visit to Indore on Saturday.indore Updated: Dec 15, 2014 17:03 IST
The acute cash crunch being faced by MP government since September this year seems to be over, with chief minister Shivraj Singh Chouhan announcing a slew of fund allocations during his visit to Indore on Saturday.
As reported by HT, the government is setting up a corpus of Rs 100 crore to help fund start-ups by entrepreneurs. The CM also announced a fund allocation of Rs 375 crore for cleaning the Khan river. Besides, the government will allocate funds for setting up GPS-enabled emergency buttons in about 15,000 public vehicles.
In September, shortage of cash had forced the finance department to issue a circular asking the departments not to incur expenditure above Rs 25 crore without its clearance. “The finance department’s notification was in response to a temporary liquidity crisis and has since been withdrawn,” an official said.
One of the reasons that had contributed to the cash crunch was bulk release of about Rs 1,000 crore for payment as compensation to farmers. Also, funds from certain departments of the Centre were delayed too.
Another reason for the cash crunch was that the MP had to pay about Rs 500 crore as wages under MNREGA from its coffers as arrival of funds from the Centre were delayed owing to the vote-on-account of the Union government. The government also spent crores for organising the Global Investors Summit. While it received investment proposals to the tune of Rs 5.89 lakh crore, the money from lease of industrial land will arrive in tranches. However, the government will have to spend a lot more for infrastructure development in the new industrial areas.