A comment on the economic situation 2006

:.

The total budget deficit of state projected for the financial year 2004-5 is nearly Rs. 5300 crores . Salaries ,pensions and interest payment accounted for 85% of the states revenue expenditure in 2003-04 . So whatever the state Government generates by taxes etc goes into maintaining the Government establishments itself ,the offices , the police force, hospitals, schools ,the etc .Nearly 7000cr is the annual expense for paying salaries and pensions alone .There is no money to spend for development. The expenditure on development shows a negative trend from 2000 onwards..

The public debt of Kerala is up to 41709 crore in 2005 from 23000 crore in 2002 . The per capita debt is Rs 9,425 as against the average for all states at Rs 6,652 during 2002-2003 . Total liabilities as percentage of states income was 36% in 2003. The debt and interest over debt accumulates at such a rate that it has overtaken the capacity of Government to borrow further. The Government services debt at average interest rate of 11% ie, 3850 crore should be given in the current year . Kerala is also one of the few states which actually down sized plan fund in successive years .ie ,the economy is shrinking ! There is less and less money to spend on development!
The total deposits in commercial banks as in June this year (2005) touched Rs 69,093 crore, including an NRI deposit to the tune of Rs 28,728 crore,.The Credit-Deposit ratio of the banking Sector in the State has reached 61.25 per cent in 2005. The Commercial banks in the state have disbursed Rs 4141 crore to priority sector during the first quarter ended June 30, 2005. The banks are aiming at disbursing Rs 19271 crore during 2005-2006, out of which Rs 8010 crore is earmarked for Agriculture sector, Rs 2641 crore to SSI sector and Rs 8620 crore to other priority sectorsThe total deposits in commercial banks as in June this year (2005) touched Rs 69,093 crore, including an NRI deposit to the tune of Rs 28,728 crore,.The Credit-Deposit ratio of the banking Sector in the State has reached 61.25 per cent in 2005. The Commercial banks in the state have disbursed Rs 4141 crore to priority sector during the first quarter ended June 30, 2005. The banks are aiming at disbursing Rs 19271 crore during 2005-2006, out of which Rs 8010 crore is earmarked for Agriculture sector, Rs 2641 crore to SSI sector and Rs 8620 crore to other priority sectors