Meghalaya has emerged as the state with the fourth highest Outstanding Liabilities to Gross State Domestic Product (GSDP) ratio in India, according to the latest audit report by the Comptroller and Auditor General (CAG) for the fiscal year ending March 31, 2023. Among the Northeastern and Himalayan states, Meghalaya ranks third, signaling a growing debt burden.
The CAG report highlights the mounting financial liabilities on the state’s Consolidated Fund, which include market loans, borrowings from financial institutions, and advances from the Government of India (GoI). Public debt for the year 2022-23 stood at a staggering ₹14,637.12 crore, comprising ₹11,285.50 crore in market loans, ₹1,349.04 crore in institutional loans, and ₹2,002.58 crore from the GoI.
The report points out a significant 20.31% increase in public debt compared to the previous year, driven primarily by a 117.40% surge in loans from the GoI and a 13.79% rise in market loans. Additionally, liabilities on the Consolidated Fund of the State saw a 20.74% increase over 2021-22, with a notable 161.90% jump in advances from the GoI, excluding back-to-back loans in lieu of GST compensation shortfall.
The CAG expressed concern over the state’s failure to meet the total outstanding liabilities to GSDP ratio target of 28% as mandated by the Meghalaya Fiscal Responsibility and Budget Management (MFRBM) Act, 2006. The report warns that without proactive measures, Meghalaya risks slipping into a debt trap.
