Andhra Pradesh planned to borrow Rs 35,000 Cr in the second quarter of Financial Year 2023-24 but ended up borrowing Rs 8,500 Cr more than the estimate to make both ends meet.
Similarly, Telangana, one of the richest states, planned to borrow Rs 22,700 Cr but ended up borrowing Rs 6,300 Crore more than the estimate.
Tamil Nadu aimed at Rs 49,000 Cr but borrowed Rs 54,000 crore, which is Rs 5,000 Cr more.
The same is the case with another South Indian state, Kerala, which estimated to borrow Rs 17,500 Cr but borrowed Rs 20,800 Cr.
The noteworthy revelation is that Karnataka stands as the sole exception; throughout this period, the state refrained from securing any funds, despite its initial plan to borrow â¹19,000 crore.
Surprisingly, this phenomenon of borrowing more than the estimation is only observed in the South Indian states.
The North Indian states are borrowing significantly less than the estimates.
While UP planned to borrow Rs 40,000 Cr, it finally borrowed only Rs 18,500 Cr. Gujarat planned at Rs 23,000 Cr but borrowed only Rs 8,000 Cr. West Bengal also aimed at Rs 30,500 Cr of borrowing but finally fulfilled it with Rs 19,500 Cr only.
Why is this happening? The reason is simple.
The governments of South Indian states are overwhelmed with freebies for the citizens. The competition between the parties has resulted in overwhelming manifestos with loads of freebies that incur thousands of crores in expenditure.
However, this phenomenon is not limited to the South. Already, the highly publicized 'free-bus-travel for women' by the Congress government in Karnataka and Telangana is being demanded by women in Uttar Pradesh now. If every such scheme from the South is imitated by the North Indian states as well, the burden on the central government would be immense as the onus to fund the states also lies on it.
To fulfill these, the government will have no way left other than increasing taxes and levying new tax slabs, burdening the industries, businessmen, and employees.
There seems to be no end to this freebies scenario! Who can help unless a strong bill is passed in the Parliament regarding the limit to freebie promises in manifestos and the introduction of new welfare schemes while in rule?