Higher debt swap target for states

Rs 62,000cr may be pre-paid this fiscal

Enthused by the sharp upsurge in small savings collections, the finance ministry has scaled up the target under the states debt swap plan to Rs 62,000 crore by the end of the current fiscal. The government has facilitated the pre-payment of about Rs 50,000 crore by the states during the calendar year 2003.

High-cost debt amounting to Rs 62,000 crore was expected to be pre-paid by states by the end of the current fiscal under the debt swap scheme, Finance Minister Jaswant Singh told the Rajya Sabha today.

Replying to supplementaries during Question Hour, Singh said during the previous and current fiscal, Rs 50,000 crore of high-cost debt has been pre-paid by states till now. The government has targeted an amount of Rs 1,14,000 crore in three years time under the scheme, he said.

In reply to a query, Singh said Maharashtra, which was the only state to have opted out of the debt swap scheme till last year, decided to join the scheme this year. He said the state had plunged into financial difficulties due to issuing of guaranteed debts worth Rs 60,000 crore that was now telling on its fiscal health.

The finance minister said some states had problems in participating in the scheme due to financial constraints as a portion of their finances was from small savings.

In reply to another question, Singh said the interest on fixed deposits for a duration of above five years had come down to between 5.5-6 per cent as on December 1, 2003 as against 11.5-12 per cent in April, 1998. The savings bank rates had gone down from 4.5 per cent to 3.5 per cent.

In reply to a question on income tax issues, Minister of State for Finance Sripad Naik informed the House that the income-tax department had allotted Permanent Account Numbers to 311 million tax payers up to November 30 of this year. He said in a written reply that the actual number of cards issued was 293 million and the process of issuing cards for the remainder of the population was in progress.

The minister's reply was in response to queries from members on the backlog on the issuance of PAN cards. He said a total of about half a million applications for PAN were pending with the department as on date. The total number of income tax assesses all over the country as on March 31, 2003, was 302 million. In the period between April to end October, the number of assesses has gone up by 5,71,626.

The income tax department had outsourced the work of issuing PAN cards to UTI-ISL in July this year. Under the procedure agreed to between the tax department and UTI-ISL, the latter is supposed to dispatch the cards within 15 days of receiving the completed applications.