Debt sustainability of state finances of Uttar Pradesh government

Nagendra Maurya ()

MPRA Paper from University Library of Munich, Germany

Abstract: Serious deterioration in government fiscal finances in the late 1990s and early 2000s asked for prudent fiscal management. The fiscal deterioration of 1990s and 2000s led to elevated levels of debt liabilities at both the national and sub-national level. Uttar Pradesh (UP) fiscal position during 1990s and 2000s was one of the most vulnerable. Fiscal and revenue deficit and debt levels were appallingly high creating unmanageable pressure on fiscal finances. The UP government has enacted its FRBMA in 2004 with the aim to arrest rising deficits and debt which mandated reduction in deficit and debt levels within a limit in a given time frame. The sustainability analysis has been made in the current study to capture the effect of reforms on debt position and to assess sustainability of debts in pre and post FRBMA years. Our analysis suggests improvement in all debt and deficit indicators in post 2004-05 years. Debt analysis also confirms sustainable fiscal health (τ = -4.533; p

Keywords: Debt Sustainability; Sub-national Government; State Finances; FRBM Act; Uttar Pradesh (search for similar items in EconPapers)
JEL-codes: H0 H63 H72 (search for similar items in EconPapers)
Date: 2014-05-03
New Economics Papers: this item is included in nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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