Tamil Nadu has borrowed Rs 20,881 crore over the three months from April to June in the current financial year, primarily for capital projects, according to the report. During the same period, the state paid Rs 14,618 crore as interest on its outstanding debt.
The government earns revenue through multiple streams including State GST, stamp duty and registration fees, and taxes on sales and trade. However, spending on salaries, pensions and interest payments is met through resources such as bond issuances and borrowings from banks when expenditure exceeds receipts.
Borrowing through the sale of government bonds is described as the largest component, and the funds are used for infrastructure works such as road laying and bridge construction. The report notes that the state’s total debt is already around Rs 10 lakh crore.
For the full financial year, the government has planned to borrow Rs 1.22 lakh crore and spend Rs 76,452 crore on interest. Interest payments are stated to account for 22.82% of total revenue.
