Post News Network
Bhubaneswar, Dec 2: After successfully raising Rs 1,000 crore from the market, the state government is planning to raise another Rs 1,000 crore in two tranches in December this year, official sources said.
Additional chief secretary of Finance department, R Balakrishnan told reporters Tuesday that the state could borrow Rs 6,000 crore provision for which has been made in this year’s budget.
Last month, the state government raised Rs 1,000 crore as part of its market borrowing plan at an attractive yield of 8.03 per cent. The proceeds of the loan would be utilized in capital investment, the state government had earlier said.
As per officials of the Finance department, the state is sitting on a comfortable liquidity position with sound growth witnessed in tax and non-tax revenue.
Further fund raising through market borrowing is likely to supplement government’s effort to create capital asset.
Interestingly, the state government had refrained from market borrowing 2006-2007 onwards. Last time, it had raised money from the market during 2005-06.
Market borrowing is one of the routes available to a state government to meet deficit along with creation of capital asset.
With the macroeconomic parameters like GDP growth, revenue deficit, fiscal deficit, tax to GDP ratio at sound footing, Orissa government has larger space to leverage its balance sheet to fund capital expenditure.
Meanwhile, some observers have pointed out that due to reduction in central assistance in some of the schemes, the state government has to increase its funding sources to meet additional expenditure.
Tuesday, the state government presented a Supplementary Budget of Rs 11,488.63 crore for 2015-16 financial year.
This additional expenditure will be financed by tied-up resources to the tune of Rs 3,246.44 crore, untied resources to the tune of Rs1,149.05 crore and Rs2,671.81 crore from overall savings and surrender towards the end of the financial year, the state government said.
