State debt is within limits, says CM | mumbai | Hindustan Times
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State debt is within limits, says CM

mumbai Updated: May 21, 2011 01:47 IST
HT Correspondent
HT Correspondent
Hindustan Times

A day after the planning commission approved Maharashtra’s annual plan of Rs42,000 crore for 2011-12, chief minister Prithviraj Chavan said the state debt of Rs2.30 lakh crore was within the stipulated limits.

“The planning commission was satisfied with our financial position because our debt is 22% of the state’s gross domestic product. The maximum allowed limit is 26%,” he said on Friday.

Chavan said there will be no cut in expenditure this financial year. The state had given a 10% mandatory cut to all departments last year because it had to spend on other priority issues.

Chavan also assured that the government will ensure that entire Rs42,000 crore allocated this year is spent. Lack of financial discipline has been an issue in the government, where departments do not spend the amounts allocated to them.

“Last year, the planning commission had approved Rs 38,000 crore, but only Rs32,000 crore was spent,” he said.

The reasons for the less spending, Chavan said, are lack of initiation by departments and, in some cases, central policies. “The rural development department spent less on schemes such as Rajiv Gandhi Gram Sadak Yojana, because the Centre was not giving funds to old roads, but for new linkages, and Maharashtra has none. But, in case of NREGA, we put some new machinery in place and things have changed.”