Congress MP Manish Tewari has asserted that Punjab now possesses the second-worst debt-to-GDP ratio among all Indian states, trailing only Nagaland. Tewari, speaking on Thursday, highlighted the absence of this critical financial issue from the state's political discourse, even within the Punjab Vidhan Sabha.
Mounting Debt and Congress Criticism
This latest claim intensifies the Congress party's ongoing critique of the Aam Aadmi Party (AAP) government, which has been in power since 2022. According to Tewari, Punjab's financial liabilities have already exceeded ₹4 lakh crore and are projected to hit ₹4.47 lakh crore soon.
Earlier this year, in April, Congress MP and former Punjab Deputy Chief Minister Sukhjinder Singh Randhawa urged the Bhagwant Mann-led government to issue a white paper detailing the state's financial health. Randhawa cautioned that Punjab was spiraling into a significant debt trap, with fresh borrowings often used to service existing debt and interest payments. He pointed to a ₹1,500 crore loan taken at the time as evidence of this concerning trend.
Impact on Citizens and Accountability Demands
Randhawa underscored the direct impact of this fiscal situation on ordinary citizens, estimating that every Punjabi now carries an average debt burden exceeding ₹1.25 lakh. He also noted that a substantial portion of the state's budget is allocated to salaries, pensions, power subsidies, and interest payments, rather than crucial development initiatives.
In June, Punjab Congress chief Amarinder Singh Raja Warring echoed these concerns following another ₹1,500 crore borrowing. Warring claimed the state's debt had climbed to approximately ₹4.19 lakh crore and demanded transparency regarding how these borrowed funds were being utilized. He emphasized the public's right to know how every rupee borrowed is spent and what returns it generates for the state.
Financial Context and Political Landscape
For the fiscal year 2025-26, Punjab's Gross State Domestic Product (GSDP) is estimated to be around ₹8.91 lakh crore at current prices. The escalating debt crisis emerges as the state prepares for assembly elections early next year, potentially making fiscal management a central campaign issue.