The Centre on Monday informed Parliament that currently there was no proposal under its consideration to provide a special financial assistance package for the State of Punjab.
Ruling out an immediate financial or debt-relief package for the border state, the Union Government said Punjab has already received ₹8,379 crore under its Special Assistance to States for Capital Investment (SASCI) scheme in the form of 50-year interest-free loans.
The clarification on the issue came from Minister of State for Finance Pankaj Chaudhary at a time of recurring demands from political parties and stakeholders in Punjab for a special financial package in view of the state's mounting debt burden and fiscal stress.
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Chaudhary was replying to a question on the issue by Congress MP Dharamvira Gandhi.
The Centre said Punjab has been receiving substantial financial support under SASCI scheme, which has been implemented every year since 2020-21.
Under the scheme, states are provided financial assistance in the form of 50-year interest-free loans to support capital expenditure and infrastructure creation.
The minister said the scheme has been continued in the current financial year with enhanced national allocation of ₹2 lakh crore.
The reply indicated that Punjab, like other states, can continue to avail itself of assistance for capital investment projects
The minister also said that Punjab, like other states, continues to receive financial resources through multiple channels, including Finance Commission-recommended grants, Centrally Sponsored Schemes, Central Sector Schemes and Additional Central Assistance for Externally Aided Projects (EAPs).
Punjab's debt has risen substantially over the years and stands at roughly Rs 4.13 lakh crore as per official estimates.
The state just rolled out the Mukhya Mantri Mawan Dhiyan Satkar Yojana which promises Rs 1,000 a month to eligible women and more for marginalised sections.
NITI Aayog's Fiscal Health Index places Punjab, Andhra Pradesh, West Bengal and Kerala in the 'aspirational' category, with each state facing significant fiscal challenges.
According to the report, Punjab struggles with the quality of expenditure and faces a growing debt burden, reflected in a high debt-to-GSDP ratio and concerns over debt sustainability.
"As of 2022-23, Punjab’s debt-to-GSDP (Gross State Domestic Product) ratio stood at 47 percent, significantly higher than the median state's ratio of 32.1 per cent," the Aayog analysis shows.
It adds that the state's revenue deficit stood at 3.5 per cent of GSDP in 2022-23, compared with 0.4 per cent for the median state.
"Punjab collects less revenue compared to a median state and its expenditure-to-GSDP ratio stood at 18.9 percent," the report adds.