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As predicted by TFI, AAP’s Punjab is severely reeling under a debt crisis

Paurush Gupta by Paurush Gupta
7 September 2022
in Trending
Punjab Debt
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Punjab is witnessing the inevitable ugly side of AAP’s freebie politics. The state economy is crumbling under the tall fiscally imprudent election promises of Arvind Kejriwal and the Aam Aadmi Party. Its debt is rising at an alarming level. But the worst thing is that the state government rather than acting maturely is indulging in blame games and continuing its revdi culture. Apparently, the state employees are the first ones to pay the price for the AAP government’s gross economic mismanagement.

Punjab’s coffer runs out of exchequer money

AAP National Convenor Arvind Kejriwal made rosy promises to the Punjab voters. He got success in tricking the voters to believe in his style of politics. But it only took a few months for the state to realise the shallowness of the so-called Delhi Model. They are witnessing the ugly downside of freebie politics. Evidently, the Punjab government has not cleared the salaries of its employees for August month even after a week into September.

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Reportedly, the AAP government couldn’t clear the salaries of its state employees as the state coffers have run dry. Notably, the government pays the salaries of its state employees, for the previous month, on the first day of every month. According to the current fiscal budget, the state has to pay Rs 31,171 crores as an annual salary bill. This roughly pegs its monthly salary bill at Rs 2,597 crore.

Also Read: Punjab had a drugs problem. Then came AAP, now it has a debt problem too

Ironically, one unnamed state government official arrogantly stated that they thought the state government employees could bear for at least a week.

The official said, “As it was about money for the state exchequer, we thought that the employees could bear with the government for at least a week. We have paid salaries to Class C and D employees on Tuesday evening. The rest will be paid on Wednesday.”

As usual, the AAP government blamed the Centre for this non-payment of salary to its state employees. It tried to pass the buck on the GST compensation regime. As per the AAP government, if the Centre had accepted Punjab’s request of continuing with the GST compensation the state economy would have flourished and everything in the state would have been hunky-dory.

Outstanding debt against CM Bhagwant Mann’s Punjab government

TFI has extensively covered the looming debt crises over the Bhagwant Mann-led Punjab government. This non-payment is just a symptom of the larger debt crises hovering over the Punjab government. The state owes Rs 20,000 crores as power subsidy including Rs 18,000 crore to give free power to farmers, subsidy to industries and providing 300 units of power free every month to domestic users. Till December, the government incurred Rs 1298 crore for waiving the pending power bills of consumers.

Also Read: Under AAP’s Bhagwant Mann, Punjab is another Sri Lanka in making

The state has further liabilities in the form of Rs 20,122 crore towards interest payments, and Rs 15,145 crore towards pensions and retirement benefits. Additionally, the AAP government has to pay Rs 27,927 crore towards repayments of advances and loans, and Rs 20,000 crore towards repayment of ways and means advances.

New Revdis at a time when AAP government is neck deep in an economic crunch?

At a time when it is struggling to clear the salaries of its state employees, the Punjab Cabinet has given its approval to a new policy which would impose an extra burden of Rs 400 crore on the state exchequer. It has added a special cadre of employees to the existing strength by absorbing contractual and ad hoc employees.

Also Read: Here’s why Central government should think twice before granting any ‘Special Package’ to AAP’s government

An official of Punjab government informed that freebie politics is badly impacting the state economy. The official stressed that the scenario may be worse in the next month as the state may not be able to pay salaries till the 15th.

The official said, “We are already concerned that next month we may not be able to pay salaries till the 15th. It is going to be a crunch situation. Let us see how we manage”.

These symptoms of freebie politics should be analysed properly and the government has to rise above petty political gains and stop before it reaches a point of no return. It is disheartening to see that the state government has not learnt its lessons from Sri Lanka’s economic collapse because of economic mismanagement and freebie politics. However, the Judiciary and Centre have to ensure that if the state doesn’t mend its ways, it should be curtailed through some laws or the funds from the centre should be disbursed as per state government’s performance.

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Tags: AAPArvind KejriwalBhagwant MannDebt CrisisPunjab
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