Amid raging row, Punjab governor pulls up CM over finances

"However, according to the information available, the state government is not managing its fiscal resources in an effective and efficient manner,” the governor said.

Purohit questioned raising Rs 10,000 crore more debt than what was approved by the state Assembly in the budget.

In 2022-23, the state government borrowed Rs 33,886 crore, as against the approved amount of Rs 23,835 crore, the governor said.

Governor’s missive

“This additional borrowing needs to be explained as, apparently, it has not been utilised for creation of capital assets.

“This is evident from the fact that the effective capital expenditure dropped by over Rs 1,500 crore – from a projected Rs 11,375.59 crore to Rs 9,691.53 crore.

“Further, the additional borrowing was not even used to discharge legacy interest obligations, according to the figures projected in the revised estimates in this regard,” pointed out Purohit.

These demonstrate that the total payments defrayed on this account during the year finally stood at Rs 19,905 crore, as against a projection of Rs 20,100 crore in the budgetary estimates for 2022-23, he said.

The governor wrote back after the chief minister on October 3 pointed out that a huge amount was spent on repaying interest on borrowings which his government inherited.

Purohit also pointed out “substantial variation” in the figures furnished by the chief minister in comparison to the figures of the Comptroller and Auditor General (CAG) of India.

According to the governor's letter, the state government provided a figure of Rs 47,107 crore as an increase in debt while according to the CAG, it was Rs 49,961 crore from April 1, 2022 to August 31, 2023.

Similarly, the capital expenditure figure of the Punjab government was Rs 10,208 crore as against the CAG's figure of Rs 7,831 crore, the letter said.

The Mann-led AAP government has been at loggerheads with the Raj Bhavan on several issues.

(With agency inputs)