Goa being bled by GSIDC?

“GSIDC has been floated by the Government of Goa as a Special Purpose Vehicle (SPV) for speedy implementation of all the infrastructural projects envisaged by the government like roads, bridges, fly-overs, traffic management, bus stands, water supply augmentation, hospitals, tourism related projects, etc, all over the State on the similar lines of similar corporations in other States (viz MSRDC in Maharashtra). This would help in development of infrastructural facilities all over the State of Goa. This corporation would act as a coordinating agency for implementing all the projects.”

This is what the GSIDC website says.

And very truly, the corporation has undertaken many development works right from its inception in 2001 till the current period. But while its aims and objectives look at major works, GSIDC does not seem to concentrate only on large projects but is also getting into even the construction of toilets.

Given that the State’s current financial condition is bad, especially after the mining operations ban, and the State having to resort to other means and ways to generate revenue, one would feel there needs to be some control on spending, even if it be on development works.

Herald took a look at the GSIDC works in the last four years since the BJP took over from the Congress-NCP combine and what came out is startling. Information availed through RTI by this paper reveals that in the last four years the government has spent or tendered around 296 projects at a whopping cost of Rs 3308.41 crore.

Shocking isn’t it? Considering the amount of almost Rs 5000 cr borrowed by the government in the last four years one would say the amount has been almost fully spent only on infrastructure projects. Moreover, while so much is being spent on projects the government has failed to make financial provisions accordingly to meet the expenses.

Papers reveal that GSIDC’s expenditure that in the year 2010-11 was just Rs 150 cr has now reached a whopping Rs 800 cr in 2015-16 (revised estimate), thus showing a rise of 500 percent of the expenditure.

A senior official in the finance department says that there are so many works being taken up the government and since it has failed to make budgetary provisions for them, it has to depend on borrowings.

An RTI reply to a query on the mode of funding says “mode of funding is budget allocation for GSIDC by government and the budget allocation by client department and loans.”

Further information given in the Assembly reveals that GSIDC has borrowed from HDFC bank (Rs 25 cr in 2013-14), EDC term loan (Rs 270 cr) and Indian Bank (Rs 50 cr). Besides this GSIDC has also borrowed Rs 450 cr from NABARD for the third Mandovi bridge paying a massive interest rate of 10 percent per annum.

Now compare this with the overall borrowings of the State.

Figures show that in 2011-12, the last year of its term, the Congress government had borrowed a mere Rs 100.95 crore. When the BJP came to power it first borrowed Rs 1203.23 cr in 2012-13, Rs 1296.62 cr in 2013-14, Rs 1267.36 in 2014-15 and Rs 1105.52 in 2014-15 (up to December 31). The loans taken were from the open market, LIC, NABARD, NCDC, PFC, HUDCO, NSSF, Central loans and other ways and means. And a majority of the amount from these loans seems to have gone to the GSIDC for payment to contractors.

Chief Minister Laxmikant Parsekar has been on record in the Assembly that between April and December 2015, Rs 260 crore was disbursed to Goa State Infrastructure Development Corporation alone for repayment of dues.