MP Government to Raise ₹3,000 Crore Loan in Three Tranches During Winter Session

Bhopal: In a significant move on the first day of the winter session, the Mohan-led government of Madhya Pradesh has decided to raise a new loan of ₹3,000 crore. The loan will be obtained in three separate tranches, with repayment scheduled over different time periods along with interest. The step is aimed at funding various developmental projects across the state.

According to an official notification from the Finance Department, the three tranches will be structured as follows:

• First tranche: ₹1,000 crore, repayable over 8 years including interest.
• Second tranche: ₹1,000 crore, repayable over 13 years including interest.
• Third tranche: ₹1,000 crore, repayable over 23 years including interest.

Interest payments for all three tranches will be made biannually, in June and December. The loan will be routed through the Reserve Bank of India, with funds expected to be credited to the state government soon.

Previous Borrowings by the State Government

The Madhya Pradesh government has frequently resorted to borrowing in recent months. For instance:

• On 28 October, a loan of ₹5,200 crore was sanctioned, split into ₹2,700 crore for 21 years and ₹2,500 crore for 22 years.
• Following this, on 12 November, two loans of ₹1,500 crore each and another loan of ₹1,000 crore were taken with repayment periods of 16, 22, and 19 years respectively.
• All loans carry interest payments twice a year, every six months.

Financial Position of the State

The government reported a revenue surplus of ₹12,487.78 crore in FY 2023-24, with total income of ₹2,34,026.05 crore and expenditure of ₹2,21,538.27 crore. For FY 2024-25, the revised estimates show income of ₹2,62,009.01 crore against expenditure of ₹2,60,983.10 crore, resulting in a surplus of ₹1,025.91 crore. Officials clarified that the new loans fall within the permissible borrowing limits and are part of the state’s ongoing fiscal management strategy.