Each Tamil Nadu child born bears debt of Rs 1.28 lakh: Vijay govt's White Paper
Tamil Nadu's overall financial liabilities have risen to an estimated Rs 13.18 lakh crore, with the state's outstanding direct debt nearing Rs 10 lakh crore
Tamil Nadu's overall financial liabilities have risen to an estimated Rs 13.18 lakh crore, with the state's outstanding direct debt nearing Rs 10 lakh crore, according to a White Paper on the state's finances released on Tuesday by the Vijay-led government. The state's debt burden has nearly doubled over the past five years under the MK Stalin-led DMK government and every child born in Tamil Nadu effectively carries a debt burden of Rs 1.28 lakh, the financial status report, presented by Finance Minister N Marie Wilson, highlighted. Read Full Story The White Paper on Tamil Nadu's finances, which examines the fiscal position inherited from the previous MK Stalin-led government, was among Vijay's first major announcements after being sworn in as Chief Minister last month.
According to the document, the state's direct debt has risen sharply from around Rs 4.8 lakh crore five years ago to nearly Rs 10 lakh crore at present. When off-budget borrowings, guarantees and other liabilities are included, the state's total financial burden is estimated at Rs 13.18 lakh crore. The minister said that the debt accumulated over the past five years exceeded the total debt accumulated during the previous six decades. He added that a significant portion of the borrowings had been used to meet day-to-day expenditure rather than to create infrastructure assets. Tamil Nadu's outstanding debt-to-GSDP ratio stands at 28.2 per cent, while the revenue deficit has widened from Rs 46,538 crore to Rs 78,324 crore over the past five years, indicating a growing gap between revenue receipts and expenditure.
The report further noted that for every rupee earned by the government, 22.8 paise is spent on servicing interest payments, reflecting the increasing pressure of debt obligations on the state's finances. The paper also raised concerns about revenue generation. Growth in Goods and Services Tax (GST) revenue was recorded at 5.45 per cent, which the report said was insufficient to offset the rapid increase in expenditure and debt-servicing commitments. Comparing Tamil Nadu's debt position with that of other major states, the report noted that Gujarat's debt ratio stood at 17.6 per cent, Maharashtra's at 19.7 per cent and Karnataka's at 23.4 per cent, while Tamil Nadu's was 28.3 per cent, significantly higher than those of its peers.
Last month, Stalin had countered Vijay's claim that the DMK government had burdened the state with debt amounting to Rs 10 lakh crore, stating that Tamil Nadu's debt remains within "permissible limits". He asserted that the government has adequate financial resources and that what is needed is leadership with the will to govern effectively. The DMK chief has not yet responded to the White Paper since its release. Ends
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