Chandigarh, March 25 — As Punjab Finance Minister Harpal Cheema prepares to present the AAP government’s fourth Budget on Wednesday, the state’s mounting debt remains a major concern, with total liabilities projected to reach ₹3.78 lakh crore by the end of this month.
This makes Punjab the second-most debt-ridden state in the country, trailing only Arunachal Pradesh.
According to data shared by Union Minister of State for Finance Pankaj Chaudhary in Parliament, Punjab’s debt-to-GDP ratio stands at 46.6%, significantly higher than most states. The NITI Aayog’s Fiscal Health Index recently rated Punjab’s financial condition as the worst in India, with a score of just 10.7.
In the past three years of AAP’s rule, the state’s debt has surged by ₹95,000 crore. It stood at ₹2.92 lakh crore in March 2022, rising to ₹3.23 lakh crore by March 2024.
Despite the AAP government blaming previous administrations for the financial crisis, figures reveal that 78% of Punjab’s loans are used solely to pay interest on existing debt, leaving minimal funds for infrastructure development.
From April 1, 2024, to February 28, the state spent just ₹5,818 crore on capital expenditure out of its ₹1.09 lakh crore total spending.
Meanwhile, revenue receipts reached only 80.37% of the ₹1.03 lakh crore target for the fiscal year, with non-tax revenue meeting just 50% of its goal. The state has already exceeded its revenue deficit target, while the fiscal deficit is nearly double the projected figure.
