Punjab denies debt waiver offer from central government

Chandigarh, Oct 10, 2010 (Calcutta Tube) The Punjab government Friday said it had not received any communication from the central government regarding any debt waiver offer for Punjab.

‘The Punjab government has not yet received any letter or official written communication from the Government of India (GoI) regarding the debt waiver,’ Punjab Chief Secretary S.C. Aggarwal told reporters here.

Aggarwal said there was no offer from the central government regarding any debt relief or waiver or rescheduling or the proposed quantum.

He said: ‘The debate regarding the debt waiver is meaningless at this stage.’

The controversy over the debt waiver arose this week when Punjab Finance Minister Manpreet Badal raised the issue and said that the government needed to take steps, especially doing away with subsidies and populist freebies, to get the state out of a debt trap.

Punjab has accumulated a debt of about Rs. 650 billion (65,000 crore) till the end of the last financial year. A significant portion of the same was on account of the loans raised by the state during the period of militancy when Punjab was under president’s rule and the state was governed directly by the central government.

He said Chief Minister Parkash Singh Badal had taken up the issue of debt waiver on different platforms to seek relief in this regard. The issue was raised with the prime minister, union finance minister, the 13th Finance Commission and the Planning Commission at various meetings.

The chief secretary stated that as and when any offer is made by the central government regarding debt relief, the Punjab government can examine such an offer.

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