Tamil Nadu's Finance Minister Refutes EPS' Debt Claims as Groundless
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Synopsis
Tamil Nadu's Finance Minister Thangam Thennarasu strongly refuted EPS' claims of a debt crisis, asserting that the state's financial practices are sound and within recommended limits, while providing data to support the state's robust economic status.
Key Takeaways
- Tamil Nadu’s borrowing is within Finance Commission limits.
- EPS' allegations were deemed unfounded by the Finance Minister.
- State debt is linked to budget growth and GSDP increase.
- Minister Thennarasu emphasized the state's debt management.
- No cause for alarm regarding Tamil Nadu's financial health.
Chennai, Jan 19 (NationPress) Tamil Nadu's Finance Minister Thangam Thennarasu rebutted the accusations made by AIADMK General Secretary and Leader of the Opposition in the state Assembly Edappadi K. Palaniswami (EPS), concerning the state’s financial health.
Addressing the media in Virudhunagar, Minister Thennarasu insisted that the state is not entangled in a debt trap and that its borrowing and repayment practices are within the prescribed limits.
In response to EPS’ assertion that the state is on the verge of bankruptcy due to inadequate financial management by the DMK government, the minister stated, "Palaniswami has leveled unfounded allegations merely to incite controversy. His comments reflect a lack of fundamental understanding of the matter."
Minister Thennarasu clarified that a state's borrowing and repayment capabilities are influenced by its domestic production rates.
He also highlighted that Tamil Nadu's borrowing is less than the maximum threshold recommended by the Finance Commission.
Previously, EPS criticized the DMK government during a discussion on the Motion of Thanks related to Governor R. N. Ravi's address.
He noted a significant increase in the state’s debt over the last three years, citing borrowing amounts of Rs 84,747 crore (2021-22), Rs 73,957 crore (2022-23), Rs 90,369 crore (2023-24), and Rs 1,04,319 crore (2024-25).
EPS raised alarms that the total debt could surpass Rs 5 lakh crore by the conclusion of the government's term.
In reply to these assertions, Minister Thennarasu remarked that the rise in debt corresponds with the increase in the state’s budget size and its Gross State Domestic Product (GSDP).
He pointed out that Tamil Nadu’s GSDP currently stands at Rs 31.57 lakh crore, while the annual budget has surged to over Rs 4 lakh crore, thereby improving its debt repayment capability.
He reaffirmed that Tamil Nadu’s borrowing levels remain within the fiscal standards set by the Finance Commission.
"There is no reason for concern regarding the state's debt, as it is manageable and adheres to fiscal regulations," he stated.
