Chennai: Tamilnadu has a public debt of Rs 5,70,189 crores according to the white paper presented today by P T R Palanivel Thyagarajan, the minister for finanace and human resources. This is 26.69 % of gsdp which is above the allowed limit of  25% demarcated by the 14th finance commission. As per the white paper every family in TN has a public debt of Rs 2,63,976.

Presenting the significant document on the state's finances, the minister pointed out that the worsening deficit situation has led the state to be over-reliant on debts. The total revenue receipts of Tamil Nadu has come down to 8.7% of GSDP in 2020-21 from the peak 13.35% of GSDP in 2008-09. State's own tax revenue has declined from 11.46% between 2006 to 2011 to 4.32% between 2016 to 2021.

''The fiscal situation of the State is in dire circumstances, in part due to extraneous circumstances, but in substantial measure due to structural flaws in governance which have not been rectified in a timely manner. We hope this report clearly explains these circumstances, and how we arrived at this crucial juncture. The Covid pandemic has greatly exacerbated the situation and highlighted how vulnerable Tamil Nadu currently is. There are no buffers left. No fiscal headroom that will allow for delay.'' said the minister.

PTR Palanivel Thyagarajan made it clear that the state will have to adopt serious measures to overcome the presnt crisis. ''Business-as-usual cannot continue, and our approach must fundamentally change if we are to break out of this vicious cycle of increasing debt and interest costs. On the other hand, this is an opportunity to effect 'once in a generation' reforms, many of which should have been undertaken years ago by any responsible Government.''

He reiterated that that the state can not borrow indiscriminately. ''Borrowing to spend on salaries, pension and interest must be stopped.''

The minister pointed out that the first step in any solution was  always a true recognition of the problem. ''The white paper is a significant step in providing tansparency. This will enable us  in gaining the confidence of the public.''

He hoped that the Chief Minister's Global Economic Advisory Council, consisting of Nobel-laureate Prof. Esther Duflo, former Governor of the Reserve Bank of India Prof. Raghuram Rajan, former Chief Economic Advisor of India Dr. Arvind Subramanian, noted Economist Prof. Jean Drèze, and the former Union Finance Secretary and Economic Advisor to the Prime Minister, Mr. S. Narayan, IAS would provide guidance in dealing with the present financial hurdle blocks.

The state needs radical reforms to gain financial security but that doesn't mean that Tamil Nadu would give up the much acclaimed welfare measures which have been the hall mark of governance for quite sometime, quipped the minister.