CHANDIGARH: The cash-strapped Aam Aadmi Party (AAP)-led Punjab government is expected to borrow Rs 49,900 crore this year alone. By the end of the next fiscal year, the state’s public debt is projected to touch an alarming Rs 4.17 lakh crore, making it the second-most indebted state in the country in terms of debt to gross state domestic product (GSDP) ratio.Sources indicate that the Punjab government plans to raise a loan of Rs 49,900 crore this year, while repaying Rs 18,198.89 crore. Additionally, Rs 24,995.49 crore will be allocated towards servicing the debt. This means that 86 percent of the state’s new borrowing will be used solely for repaying old loans and managing legacy debt. As a result, the state’s total debt liability is expected to reach Rs 4,17,136.10 crore by March 31, 2026 an approximate 9 percent increase from the current outstanding debt of Rs 3,82,934.98 crore.In 2024-25, the state government paid Rs 23,953.72 crore in interest on the outstanding debt, which was 23 per cent of its total revenue receipts as per budget documents. Thus the interest liability has been constantly rising due to its growing debt. The debt liability has gone up by Rs 1 lakh crore in the past three years.Sources said that in March 2022, when the AAP government came to power in the state the outstanding debt of the state was Rs 2.83 lakh crore. In the last three years, the government raised Rs 1.32 lakh crore loans, and of that Rs 1.05 lakh crore debt was repaid. As of that Rs 46,200 crore has been repaid towards the principal amount and Rs 59,000 crore interest on loans has also been paid.
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