Karnataka Govt to Borrow Rs 33,000 Cr to Cope with Revenue Loss amid Pandemic, Take up Devpt Works

The Karnataka government on Tuesday decided to borrow Rs 33,000 crore to cope with the revenue loss owing to COVID-19 pandemic situation and take up development works, Law and Parliamentary Affairs Minister JC Madhuswamy said. The state cabinet meeting decided to amend the Fiscal Responsibility Act to increase its borrowing limit from three per cent to the five per cent of the GSDP, utilising the provision proposed by the Centre, he said.

“The Centre this year has increased the borrowing (limit)up to 5 per cent of GSDP due to COVID. Hence, we have decided to change the state Fiscal Responsibility Act to increase our borrowing from three per cent to five per cent,” Madhuswamy told reporters. “After the amendment, the state will be able to borrow Rs 36,000 crore…. We have decided to borrow Rs 33,000 crore to start development works,” which had been impacted due to severe revenue loss following the COVID-19 pandemic, he added.