PANAJI
The 16th Finance Commission has painted a largely positive picture of Goa’s fiscal health, stating that the State’s financial roadmap up to 2030-31 remains “sustainable” if the current fiscal discipline is maintained, even as it cautioned against a gradual rise in debt levels.
In its fresh assessment of Goa's Economic Discipline’ -- the report which was made public -- the Commission noted, “the roadmap till 2030-31 looks good if the present fiscal situation is sustained,” underlining the State’s prudent approach to managing revenue and expenditure.
However, the Commission flagged a key concern: “the debt-to-GSDP ratio is projected to increase from 32.8% to 35.8%,” signalling a gradual build-up of liabilities despite overall fiscal stability.
The study also underscored improvements in debt servicing. “The effective rate of interest on outstanding debt declined from 9.29% to 7.36%, while interest payments as a share of revenue receipts fell from 12.72% to 10.97%, largely due to buoyant revenues,” it noted.
At the same time, the Commission viewed the rise in loan repayments positively. “Repayment of loans increased from 7.39% to 10.16%, which helps rein in debt build-up,” the report stated, adding that Goa’s “comfortable fiscal position has enabled higher repayments.”
In a significant observation, the Commission pointed out that “the state has repaid more to the Centre than it has borrowed in recent years,” reflecting sound financial management.
Yet, emerging trends in borrowing patterns have raised caution. “The maturity profile of market loans and the effective interest rate have gone up recently,” the report said, indicating potential future cost pressures.
The Commission also noted the absence of a clear trend in certain fiscal operations. “Withdrawals from public accounts and utilisation of cash balances do not reveal any definite pattern, with fluctuations driven by the State’s exigencies,” it observed.
The projections, based on assumptions drawn from the Medium-Term Fiscal Policy (MTFP) and past trends, indicate steady growth in revenues alongside controlled expenditure. “Revenue receipts are projected to rise from 24.1% of GSDP in 2025–26 to 25% by 2030–31, while revenue expenditure remains broadly stable,” the report observed, pointing to improved fiscal balance.
The Commission highlighted that Goa continues to prioritise capital investment, noting, “capital outlay has been maintained at 6% of GSDP, growing in line with the assumed 10% annual GSDP growth rate.” This, it said, reflects a commitment to long-term economic expansion.
On fiscal consolidation, the report stated, “the fiscal deficit is expected to decline from 4.2% to 3.7% by 2030-31, supported by continued revenue surpluses,” while the primary deficit is projected to narrow from 2.1% to 1.4% over the same period.
