Cash and Debt Management in States
This paper aims to highlight cash and debt management scenario of states in India. Each of the states is in different situations in terms of debt and deficit management and fiscal space. There has been a sharp increase in the level of debt of states because of poor revenue performance. State governments cannot raise external loans, but as resources are directly transferred to the states in recent years, risks and benefits are borne by the states now. Inflexible sources of borrowings, debt ceiling, and interest rates on state securities make the job of state governments much more complicated and challenging.