Rajasthan's economy has fallen into an acute debt crisis

The rising dependence on borrowing since 1990-91 indicates one thing – that Rajasthan's economy has fallen into an acute debt crisis.

Estimates suggest that the problem is so acute that each citizen of the state has a debt of over Rs 30,000.

The problem has been multiplying with every passing year, irrespective of the party in power.

Since 1990-91, the Congress and the BJP, who have ruled the state alternately, have had hardly any difference in their respective economic policies

The debt burden which started at Rs 6,000 crore in 1991, when Bhairon Singh Shekhawat led BJP-JD came into power, increased to Rs 23,000 crore in 1998 when the Ashok Gehlotled Congress took over

Ironically in 2003, when Congress was voted out, it left behind a debt burden of around Rs 57,000 crore.

The figure further shot up to Rs 87,000 core in 2008 when BJP's Vasundhara Raje, in her first avatar, was humbled. Gehlot in his second avatar (2008-13) took it further to over Rs 1,30,000 crore.

Every successive chief minister has displayed scant respect for the implications of the rising debt. They accuse their predecessor of economic mismanagement; but in practice, have multiplied the economic ills with sops thrown around like confetti. 

Unfortunately,BJP's Vasundhara Raje has begun her second innings without caring for any change in the trend, notwithstanding her claims of trying to reverse it.

Consequently, the plan size for 2013-14 that was proposed for Rs 46,990 crore when she sought a vote-on-account in February was increased to Rs 69,820 crore in July in her modified budget.

So far the state government has proposed to take additional estimated borrowings of Rs 22000 crore during 2014-15.

Going by past trends this is likely to reach over rs 27,000 crore by the year-end. As on March 31, 2014, net borrowings was as high as Rs 1,30,640 crore.

This debt trap, in fact, is also the result of borrowings from international financial institutions like the World Bank (WB) and the Asian Development Bank (ADB) that force sectoral reforms which are not necessarily pro-people.

This, however, does not include the Rs 75,000 crore debts on the state's three power distribution companies (Discoms) as these are treated as "independent bodies"

As the Discoms failed in debt servicing the debt worth `35,000 crore due for payment after October 2011 was rescheduled in 2011-12.

Prior to restructuring the rate of interest was between 11 and 12.5 %. After recast it became 12-13.5 % with an annual interest payment of Rs 10,000 crore.