States' debt crisis set to worsen as repayment burden looms

None of the states is in a position to pay debt out of surplus, as there is no surplus, says Icra

Starting 2017-18, the debt burden of some of the indebted states could deepen further, with the repayment schedule of market loans availed in 2007-08 kicking in.

According to the Reserve Bank of India (RBI) data, states’ total debt burden will more than double next financial year, increasing from Rs 31,820 crore in 2016-17 to about Rs 70,240 crore in 2017-18. This will further swell to Rs 1,19,900 crore in 2018-19.

A recent report by rating agency ICRA estimated that the gross market borrowing of the state governments is likely to rise from Rs 3.7 trillion in 2016-17 to Rs 4.5 trillion in