States' market borrowings shoot up 55% in FY21

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States' market borrowings shoot up 55% in FY21

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States are increasingly resorting to market borrowings to meet their funding requirements which have shot up in FY21.
Story: Niti Kiran
Design: Pragati Srivastava

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So far in the current fiscal year (7 Apr-6 Oct'20), 28 states and two union territories (UTs) have cumulatively raised a total of Rs 3.75 lakh crore through market borrowings. This is 55 per cent more than the borrowings of Rs 2.43 lakh crore in the corresponding period last year.

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As per the borrowing calendar for the first three quarters of 2020-21, states are to borrow Rs 5.07 lakh crore, of which, nearly 75 per cent have already been raised.

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In first half of fiscal year 2021, borrowings of state governments were 16 per cent (Rs 48,115 crore) more than the amount as per the borrowing calendar for the period.

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A majority of states have seen a notable increase in their borrowings. States such as Karnataka, Maharashtra, Nagaland and Tamil Nadu have seen an increase of over 100 per cent, from year ago period.

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Eight states namely Madhya Pradesh, Meghalaya, Goa, Assam, Uttrakhand, Andhra Pradesh, Odisha and Chhattisgarh have seen a rise of 50-100 per cent.

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Further, states such as Sikkim, Telangana, Jammu & Kashmir, Kerala, Rajasthan, Haryana, Gujarat, West Bengal and Mizoram have seen a growth of 23-36 per cent in their borrowings.

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States such as Arunachal Pradesh, Bihar, Jharkhand, Himachal Pradesh, Punjab, Manipur, Uttar Pradesh and Tripura have seen a fall in their borrowings during the period.