4 Lakh Crore In Debt, Madhya Pradesh Borrows Again To Meet BJP’s Promises

Less than two weeks after he took oath, Madhya Pradesh Chief Minister Mohan Yadav has sought a Rs 2,000 crore loan from Reserve Bank of India (RBI) to meet the state’s expenditures.

This is the latest indication of the state government’s poor financial health and growing debt mountain as the ruling BJP embarks on the tough task of fulfilling its promises in the run-up to the recently held Assembly polls. Mr Yadav inherited a debt burden of nearly 4 lakh crore when he took over from former Chief Minister Shivraj Singh Chouhan.

Mr Chouhan’s welfare schemes such as Ladli Behna were credited with helping the BJP sweep what was predicted to be a close contest. But it came at a high cost. The Shivraj Singh Chouhan government borrowed Rs 44,000 crore in 2023 alone, including a Rs 5,000 crore while the poll code was in force. Now, with the new government in place, the state government’s coffers are empty as it stares at a long list of promises.

Mr Yadav has, however, assured in the Assembly that there is “no crisis” and no welfare scheme will stop due to lack of funds. “Some have raised issues, saying schemes will stop. This is an unnecessary fear. No scheme, including Ladli Laxmi Yojana, will be discontinued,” he said.

Mr Yadav added that the BJP manifesto was like Ramayana and Gita and assured that all schemes of the previous government will continue.

The Opposition Congress is not convinced. Party spokesperson Abbas Hafeez said every citizen of Madhya Pradesh is in debt. “Every baby born in Madhya Pradesh is now in a Rs 40,000 debt. The BJP is continuously pushing Madhya Pradesh towards bankruptcy. When will they understand?”

Mr Hafeez said if the Congress came to power and formed a government, it would have tried to find new sources of generating revenue.

Deputy Chief Minister Jagdish Devda hit back, saying the Congress should “introspect” on its crushing defeat instead of targeting the government over its debt. “We need to borrow. If needed, we will borrow for development works like road construction, irrigation projects.”

Mr Devda alleged that the previous Congress governments in the state took loans too, but did not use them for development. Instead, they swindled the funds, he alleged.