Kerala successfully reduces debt-to-GSDP ratio amid economic challenges: CM Vijayan

Kozhikode (Kerala), May 20 (PTI) Kerala Chief Minister Pinarayi Vijayan on Tuesday said the state has made significant strides in managing its finances despite facing severe economic challenges triggered by the Covid-19 pandemic and policy-related pressures from the central government.

He said a key indicator of this financial resilience is the state's successful reduction of its debt-to-GSDP ratio from 38 per cent in 2021-22 to 34 per cent in recent years.

"The Covid-19 pandemic in 2020-21 caused a severe economic shock worldwide, which naturally impacted India and Kerala as well. However, by increasing its revenue and regulating expenditure, Kerala has managed to reduce its debt-to-GSDP ratio from 38 per cent to 34 per cent since 2021-22," Vijayan said at a press conference held here on the occasion of his government’s fourth year in office.

The debt-to-GSDP ratio is a financial metric that shows the level of a state's debt compared to its economic output.

He criticised the opposition, saying "debt promoters" have been spreading false propaganda, as if this progress was not happening. "Despite all challenges, Kerala is moving forward steadily," Vijayan added.

The CM said this improvement reflects Kerala's focused efforts to boost its revenue streams while keeping expenditure under control.

"Overcoming the severe economic downturn caused by the COVID-19 pandemic, Kerala's tax revenue growth has increased by 71.66 per cent from 2020-21 to 2024-25. According to the audited accounts for 2023-24, the share of own revenue in Kerala's total revenue is 72.84 per cent. This was 68.69 per cent in 2015-16, reflecting the efficiency of Kerala’s revenue efforts," he said.

Vijayan said the GST department will implement faceless adjudication, a system where a taxpayer’s return is processed by a computer and provided to tax officers, eliminating the need for the taxpayer to appear regularly before any specific officer for return scrutiny.

This will ensure efficient and corruption-free tax administration.

"The restructuring of the GST department was completed in 2023. According to the GST Council’s ranking, Kerala ranks first among states in GST intelligence and enforcement. Kerala is also ranked as the fastest state in providing GST registration," he said.

Kerala has taken effective steps in the GST Council to universalise e-invoicing, ensuring the correct tax for interstate goods and services trade, Vijayan added. PTI TGB SSK TGB SSK ROH

Source: PTI