Punjab, January 29:
The state of Punjab is facing a severe economic crisis, with a staggering ₹3.65 lakh crore in debt. This mounting debt is now one of the biggest challenges the government must address to stabilize the state’s economy. Due to the repeated blocking of funds by the central government, the Punjab government has been forced to rely on loans to keep the state’s operations running.
According to data from the finance department, the Punjab government has already taken on a loan of ₹28,000 crore for the financial year 2024-25. However, the state is only allowed to borrow up to ₹30,464 crore this year.
With no available funds, the government will now have to rely on an additional loan of only ₹2,385 crore from January to March 2025. On top of this, the state government is burdened by the cost of electricity subsidies, with an annual payment ranging from ₹20,000 to ₹22,000 crore.
Punjab’s debt situation has been worsening over the years. In 2019-20, the debt was ₹2.29 lakh crore, which has now risen to ₹3.65 lakh crore. To tackle this issue, the state has appointed financial advisors, yet the government continues to depend on loans.
The central government has blocked approximately ₹10,000 crore in various funds meant for Punjab, including the National Health Mission (NHM), Ayushman Bharat Scheme, Rural Development Fund (RDF), and Mandi Board funds. This has further stressed the state’s financial position.
Additionally, the Punjab government has had to make large payments for interest on its loans. In the financial year 2024-25, the government has already paid ₹15,815.56 crore in interest. In 2023-24, the interest payment was ₹23,900 crore.
According to the finance department’s figures, the state has had limited success in meeting its revenue targets, achieving only 63.8% of the set goal. Furthermore, capital expenditures have increased compared to the previous year, but the state has only completed 56.92% of its capital expenditure target.
Debt Growth Over the Years
| Financial Year | Debt (in Crores) |
|---|---|
| 2019-20 | ₹2,29,354 |
| 2020-21 | ₹2,49,673 |
| 2021-22 | ₹2,61,281 |
| 2022-23 | ₹2,93,729 |
| 2023-24 | ₹3,23,135 |
| 2024-25 | ₹3,53,600 |
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