Cash-strapped Bengal gets Rs 1,000-cr package

Cash-strapped Bengal gets Rs 1,000-cr package

With the much promised financial package promised by the Centre remaining a dream the cash-strapped West Bengal Government on Tuesday accepted yet another loan from the market to meet its salary and pension expenses.

Loath to incur popular displeasure by restructuring the existing tax regime CM Mamata Banerjee gave the go-ahead for the loan, Finance Ministry sources said, adding the bank concerned had already deposited the Rs 1,000 crore with the RBI and the State could withdraw the amount to foot the salary bill anytime. The borrowing would be through floating of Government bonds.

The Tuesday’s borrowing comes 35 days after the State Government took a loan of Rs 1,500 on October 18 to pay its employees. The Government had earlier allowed a ceiling of Rs 17,828 crore that it could borrow for 2011-12. However in August this year it was allowed to borrow another Rs 2,700 crore.

After Tuesday’s development the State Government’s borrowing on this account went up to Rs 16,173 crore Meanwhile Left and Congress trade unions joined hands to stage a joint demonstration demanding immediate clearance of salaries for the 18,000 employees of the four State Transport Corporations.

“The 18,000 Government transport employees have not received their salaries and another 6,000 pensioners are languishing penniless for the past several months as the Government has refused to pay them citing losses incurred by these companies,” said CITU leader Kali Ghosh, adding both Left and Congress unions would stage a demonstration on November 25.

The Left Government had increased a loan of Rs 5,173 crore out of which the present Government has repaid Rs 1,000 crore as principal, Finance Ministry sources said adding the Government would have to repay around Rs 20,820 crore by way of paying interest and principal which would “create extra pressure on the Government next month”.