Meghalaya Cabinet approved to regularize MFRBM Ordinance, 2020

A Correspondent

SHILLONG: The Meghalaya Cabinet on Tuesday approved to regularize the Meghalaya Fiscal Responsibility and Budget Management (MFRBM) (Amendment) Ordinance, 2020. It may be mentioned that on February 28 this year, the Cabinet had given its approval to the ordinance.

It may be pointed out that the ordinance is to maintain the fiscal deficit at an annual limit of 4.1 percent of the GSDP during the current financial year.

Informing media persons after the Cabinet meeting, Minister James K Sangma said as per the proposed amendment to the Meghalaya Fiscal Responsibility and Budget Management Act, 2006 it aims to increase the net borrowing ceiling from the existing 3 percent of the GSDP to 4.1 percent.

“As the Budget session of the Meghalaya Assembly is currently going on and in view of the current fiscal stress on the State, it was proposed that the amendment of the FRBM Act 2006 should be regularized by a regular enactment,” Sangma said.

He also said that MFRBM sates that there is a certain ceiling on the amount of borrowing the State can take in terms of availing loans. As per the Act, the government cannot exceed 3 percent of the GSDP of the State. “So, therefore, this relaxation will help the government to break that ceiling of 3 percent and go beyond to 4.1 percent so that we can make more borrowings and tide over whatever deficit we may have in terms of bridging gaps for development projects,” Sangma said.

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