Shillong, March 10: Chief Minister Conrad Sangma has downplayed criticism from the opposition members that the state government is funding projects from loans.
He also assured the House that Meghalaya will not fall into debt trap.
Giving an elaborate reply following the discussion on the budget 2024-25 in the Assembly on Monday, the chief minister said that the state’s own increased resources, after engaging with the finance commission, helped in accelerating growth as the commission had allotted a higher devolution of state’s share of central taxes worth Rs 10,910 crore.
According to the chief minister, the 50 year- loans under Special Assistance to States on Capital Investment (SASCI) and Externally-Aided Projects (EAPs) are like free money.
“SASCI is like a grant and a letter has been sent to Accountant General and Ministry of Finance, Government of India from Finance Department, Government of Meghalaya to depict Fiscal Deficit and Debt to GSDP both with and without SASCI in the AG report”, he said.
“Out of Rs 29,438 crore, Rs 3800 crore is the loan factor, the rest is all our central schemes or the state’s own resources which include the share of central taxes and our own taxes”, he said.
The chief minister said less than 11 to 12 percent is the borrowed amount which is again as per the norms that have been laid by the different agencies including Government of India’s finance department and reserve bank of India (RBI).
“The national average is 19 percent and for the states like Assam and other states it is at 19 percent of the total borrowings over the receipts and we are well below that number at 12 percent”, he said, adding that Meghalaya will be taking interest free loan at Rs 2450 crore under SASCI meant for 50 years.
“Nobody will ask questions till 50 years from now and therefore if you calculate the net value of Rs 2450 crore, it is Rs 83 crore as of today”, he said.
Regarding the provision of consolidating sinking funds (CSF), the state will have to put Rs 12 crore in the CSF every year for the next 50 years and that will give interest. “And that is going to be Rs 5155 crore in 2075 which means when we have to repay Rs 2450 crore, we will have actually Rs 5155 crore double of what we have to pay because of the fact that interest is not applicable,” Conrad added.
On the externally aided projects, Conrad said that EAPs in 7 years is Rs 7427 crore and effective EAPs to be repaid is Rs 742 crore.
“Out of Rs 100 crore we take under EAPs , the government of Meghalaya has to pay 20 percent of it and 72 percent is repaid by government of India so there is no question of us taking any loan” , he said.
The chief minister also highlighted 10 opportunities and 10 commitments launched since 2022 to continue till 2032 when the state will achieve 60 years.
After his speech when further clarification was sought, the chief minister assured the Opposition Leader Mukul Sangma that loans will not be used for repaying borrowings as Mukul also wanted the government to use whatever is borrowed to create assets.
CM’s scholarships
The chief minister banked on scholarship programme initiated by him to help the students.
The post matriculate scholarship will be provided to 80,000 students with Rs 6,000 each every year.
