BJP’s ‘wasteful expenditure’ made Himachal debt stressed, claims Congress white paper 

The Congress government tabled a ‘white paper’ on the State finances in the State Assembly during the ongoing monsoon session. The paper held the BJP-led Central Government equally responsible for the State’s economic mess and added that the State has landed into a poor fiscal position due to shortsightedness and ineffective policies of the previous government during the last five years.

The Congress government in Himachal Pradesh on September 21 blamed the previous Bharatiya Janata Party (BJP) government for making the hill State ‘debt stressed’ and the prevailing grim financial situation.

The Congress government tabled a ‘white paper’ on the State finances in the State Assembly during the ongoing monsoon session. The paper held the BJP-led Central Government equally responsible for the State’s economic mess and added that the State has landed into a poor fiscal position due to shortsightedness and ineffective policies of the previous government during the last five years.

“The previous BJP Government relied on borrowings as the main source of funds instead of making efforts for resource mobilisation. During its five-year period, the previous State government incurred wasteful expenditure as even party programmes were funded from the State exchequer. Huge amounts were spent on the celebration of events such ‘Amrit Mahotsav’, ‘Pragtisheel Himachal: Sthapna ke 75 Varsh’ and ‘Jan Manch’, which were used as a tool to publicise previous government’s party programmes, prior to the 2022 Assembly election,” said the paper.

The paper added that the current Congress government inherited total direct liabilities of ₹92,774 crore from the previous government. These liabilities consist of debt liabilities of ₹76,630 crore, other outstanding liabilities of ₹5,544 crore on account of deposits and reserves of various departments accrued in Public Account and un-paid liabilities of around ₹10,600 crore on account of pay revision and Dearness Allowance till December, 2022, it said.

It added, “There was a ray of hope that the ‘Supposed Double Engine’ government [BJP in the state and in Centre] would give pace to the developmental activities in the State. However, Himachal Pradesh didn’t benefit from the ‘double engine’ government as they could not get any extra resources for the state.”

According to the paper, due to the dependence of the previous government on borrowings, the debt stock of the State government has increased sharply. “The fiscal position of the State has become precarious. “Today, Himachal Pradesh is under debt stress and ranks as the fifth highest debt stressed State amongst all the States, as per a Reserve Bank of India report. The present government received not only a huge debt liability in legacy but also large unpaid liabilities of employees and pensioners. Moreover, several new institutions were opened haphazardly just before the general election.”

The paper pointed out that the debt liability at the end of fiscal year 2017-18 was ₹47,906 crore which increased by ₹28,724 crore with an average increase at a rate of 12% per annum during the fiscal years 2018-19 to 2022-23 and reached at the level of ₹76,630 crore at the end of 2022-23.