Political storm over Madhya Pradesh’s rising debt:Finance Minister says, ‘Funds are spent on capital works, calling it investment, not debt’

As the BJP-led Madhya Pradesh government under Chief Minister Dr Mohan Yadav marks two years in office, a political confrontation has erupted over the state’s rising debt burden. The government has taken loans worth nearly ₹50,000 crore over the past year and is preparing to raise additional funds in December, prompting the Congress to accuse it of financial mismanagement. Responding to the allegations made by former Congress MLA Sanjay Yadav, Deputy Chief Minister and Finance Minister Jagdish Devda defended the borrowing, presenting debt calculations and drawing comparisons with the previous Congress regime. Devda said all loans are taken strictly within the prescribed rules and with approval from the Government of India. He added that borrowing for development projects and public welfare schemes is a standard financial practice. Devda made these remarks during a recent visit to Jabalpur, where he highlighted the government’s achievements. More loans planned in December Political sparring over state borrowing has intensified even before the end of 2025. According to official data, the Madhya Pradesh government raised a loan of ₹4,000 crore on November 12. Another ₹3,000 crore loan is scheduled for December. As per the finance department notification, the December loan will be raised in three tranches, with repayment periods of 8 years, 13 years and 23 years, respectively. Loans taken during 2025 ‘Loans used only for capital works’ The Finance Minister said the borrowings remain within the debt ceiling and are used exclusively for capital expenditure, not for revenue spending. He said interest payments are being made on time and described the loans as “investments, not liabilities”. “If loans are used to build roads, ponds and infrastructure, they generate employment and development,” Devda said. He also claimed that during the Congress regime, loans were used to pay salaries, while the BJP government is spending borrowed funds only on capital projects. He added that the condition of roads and irrigation infrastructure has significantly improved. Debt exceeds annual budget In the current financial year, Madhya Pradesh has a budget of ₹4.21 lakh crore, while the state’s total debt has climbed to ₹4.64 lakh crore—₹43,000 crore more than the budget size. Congress has termed the growing debt a sign of financial failure. Sanjay Yadav alleged that the government is borrowing heavily for publicity and promotion, claiming that the Mohan Yadav government’s debt has surpassed its budget. He said the rising debt burden is pushing every citizen into a “debt trap” and accused the Finance Minister of failing to manage the state’s finances, calling the situation alarming.