Assam Assembly Passes Bill to Increase Debt-to-GDP Ratio
Assam’s Assembly on Wednesday passed an amendment bill to raise its debt-to-state gross domestic product (GSDP) ratio to 32% and raise the additional borrowing ceiling from 0 .50% of GSDP. The Assam Fiscal Responsibility and Fiscal Management (AFRBM) (Amendment) Bill 2022 passed by voice vote after the Congress, AIUDF and the sole independent MP in the House staged a strike to protest the increase in government loans.
With the passage of the bill, the debt to GSDP ratio was increased to 32% from 28.5% currently for the next five fiscal years from 2022-2023.
The additional borrowing ceiling was also raised by 0.50% of GSDP above the prescribed limit of 4% for 2022-23 to 2024-25, which would be linked to power sector reforms, by the through the amending bill.
Finance Minister Ajanta Neog, proposing the bill, argued that raising the debt ratio and borrowing ceiling is in the interest of the state.
Speaking against the amendment bill, opposition Congressman Bharat Narah argued that the state has only been able to achieve its goal in only one of the four parameters set to increase borrowing.
Due to the ease of doing business, power reforms, one nation ration card and urban body reforms, the state government only completed the first clause, he said. affirmed.
Narah said the government should focus on cutting spending rather than increasing lending.
AIUDF MP Aminul Islam and independent lawmaker Akhil Gogoi also voiced their opposition to the increased borrowing.
Neog, in his response, argued that the state government was working within the authorized limits of the central government.
She also assured the House that the additional funds will only be used for capital expenditures.
Dissatisfied with the government’s response, the opposition staged a walkout. The Assembly also passed several other bills.
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