Fiscal reform in Kerala: An assessment of impact of fiscal responsibility legislation (2003) on debt scenario
- Bihar Journal of Public Administration
- 21(1), Jan-Jun, 2024: p.61-72
Reform in fiscal management in Kerala, for consolidation of fiscal health and meeting the debt crisis, was introduced through passage of Kerala Fiscal Responsibility Act 2003. Now it is high time to assess Kerala’s fiscal health with special reference to debt scenario. With this view in mind, the present paper intends to examine the debt scenario of the state in comparison to pre reform periods. As such, the performance of multiple deficit and debt indicators have been examined in the context of GSDP of Kerala. Based on analysis of secondary data, the present paper finds that debt position of the state in terms of Outstanding State Liabilities and Outstanding State Guarantees, indicates that mean outstanding debt obligations to GSDP too has fallen in the post-FRL (Fiscal Responsibility Law) phase. Deficit indicators such as fiscal deficit to Gross State Domestic Product (GSDP) ratio, revenue deficit to GSDP ratio and primary deficit to GSDP ratio have fallen in the post FRL phase compared to pre FRL phase in the state. – Reproduced