Panaji: Goa’s gross fiscal deficit has increased by 680% since 2004-05 as the government struggles to earn enough revenue to meet its yearly expenses, particularly expenditure on social welfare schemes and infrastructure development. To try and fund this deficit, the state has relied on borrowings, mainly state development loans that have pushed Goa’s outstanding liabilities from Rs 4,417 crore in 2005 to Rs 31,758 crore in 2023, a 618% jump.
The Reserve Bank of India’s Handbook of Statistics, which was released recently, shows that Goa’s economy has also grown in size during the near two decade period. From a gross state development product of Rs 12,713 crore in 2004-05, Goa’s economic heft has risen to Rs 55,547 crore at constant prices in 2021-22. The figures for the year ending March 2023 are awaited.
The increase in borrowings has had an impact on interest payments that the state has to make to service the state development loans. From Rs 323 crore in 2004-05, the state ended up paying Rs 1,988 crore to service the state’s debt, a 515.48% increase.
While Goa is well within the fiscal deficit limits, that has not stopped the Comptroller and Auditor General (CAG) of India from cautioning the state about the burgeoning debt. The CAG has repeatedly asked Goa to prepare a roadmap to repay outstanding loans.
In the current financial year, the government has managed to limit its borrowings to half of Rs 3,500 crore, which is the permissible borrowing limit for 2023-24.
Finance department officials said that the government borrows to pay for capital expenditure such as infrastructure construction and development programmes.
RBI’s Handbook of Statistics on state government finances shows that Goa’s capital expenditure rose from Rs 598 crore in 2004-05 to Rs 6,058 crore in 2022-23.
Similarly, social sector spending has also jumped from Rs 798 crore in 2004-05 to Rs 8,659 crore in the last financial year. Expenses on social welfare schemes, which usually hovered around Rs 5,000 crore, spiked during the Covid-19 pandemic, peaking at Rs 10,286 crore in 2021-22.
