Chandigarh
Punjab Governor Banwarilal Purohit has addressed a letter to Chief Minister Bhagwant Mann, raising concerns about the state government’s fiscal management and transparency. In the letter, the Governor accused the government of diverting capital receipts for undisclosed purposes and inquired about the additional borrowing undertaken beyond what was approved by the state Assembly in the Budget. Purohit stressed that borrowings should ideally be directed towards creating capital assets rather than funding populist measures. He also emphasized the importance of transparency and the need for a comprehensive picture of the state’s finances. The Governor suggested that approaching the government of India for assistance might be possible once such a comprehensive view is available. Furthermore, Purohit advised the Chief Minister to carefully calibrate public borrowings to ensure that Punjab’s youth are not burdened by unsustainable debt. He urged the government to follow prudent fiscal policies to effectively manage the state’s limited financial resources. The Governor noted that the state’s borrowing and fiscal management have raised concerns, citing an example of borrowing Rs 33,886 crore in 2022-23, significantly exceeding the approved amount of Rs 23,835 crore. He pointed out that this additional borrowing does not seem to have been utilized for creating capital assets, as evidenced by a drop in effective capital expenditure. Governor Purohit had previously written to the government, seeking explanations for the substantial debt raised in the past 18 months. His latest letter reiterates the need for fiscal prudence and transparent financial management in the state.
