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The stringent lockdown imposed to curb the COVID-19 outbreak has had a crippling impact on the economy of Madhya Pradesh, where tax collection — SGST and IGST put together — dropped by close to 85% in April.

Madhya Pradesh Fiscal Deficit Pattern
Madhya Pradesh Revenues Dropping Expediture Increased


  • Regarding GST arrears, the Centre has settled only part of the pendency for December and January.
  • Staring at an imminent financial crunch, the State advanced its borrowings for April and May.
  • The advance borrowing is vital given that the open market borrowing limit is considerably lower than the State’s urgent needs.
  • Further, the priority is on only essential expenditure at present, relating to managing the COVID-19 pandemic, sustaining the lives of the poor, employment generation, and capital expenditure.
  • Under different schemes, the government has infused an additional ₹1,000 crore in the Health department to help it deal with the outbreak.
    Necessary relief has come from the Reserve Bank of India, which has hiked the Ways and Means Advances limit of ₹1,600 crore by 60%.
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