Jammu, Apr 4: Hauling up the Jammu and Kashmir government for its growing debt pile, the Comptroller and Auditor General of India AG says the state's fiscal liabilities increased by 18 per cent to Rs 28,735 crore in 2009-10.
 "The overall fiscal liabilities of J&K State have increased from Rs 23,287 crore in 2008-09 to Rs 28,735 crore in 2009-10," said the CAG report for the year ended March 31, 2010.
 The CAG report, which was tabled in the Jammu and Kashmir Legislative Assembly , expressed concern over the state debt and said, "Fiscal liabilities of the state have increased by 18.31 per cent during 2009-10 over the previous year."
 The total liabilities comprise Rs 15,449 crore of internal debt, loans and advances from the central government, the CAG said.
 The fiscal liability as a ratio of the gross state domestic product (GSDP) was 75.03 per cent at the end of the March 31, 2010, the CAG said, up from 69.78 per cent in 2008-09.
 The state also acts as banker and trustee in respect of deposits like small savings collections, provident funds and deposits, the CAG noted. It berated the government for an overall increase of Rs 2,237 crore in its liabilities on this account in 2009-10.
 Interest payments on debt and other liabilities totaling Rs 2,138 crore constituted 14 per cent of the revenue expenditure of Rs 15,324 crore, the CAG said, adding that interest payments on public debt amounted to Rs 1,667 crore.
 Concluding that the fiscal debt situation had deteriorated in comparison to the previous year, the CAG said the state should make urgent efforts to reduce its fiscal liabilities and deficit.
 It said the debt sustainability of the state was dismal and the resource gap has also increased during 2009-10.
 The CAG further advised the state government that taking recourse to borrowed funds should be carefully considered and managed so that the recommendations of the 13th Finance Commission for bringing the fiscal liabilities-GSDP ratio to under 25 per cent could be achieved in the next five years.

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