A state on the brink of bankruptcy: Ashok

Leader of Opposition in the Legislative Assembly R. Ashok on Tuesday claimed Karnataka was “on the verge of bankruptcy” and wondered if it had the financial strength to handle the drought as he read a Finance Ministry note that said the state had exhausted its borrowing capacity to meet the 2026-27 budget announcements and accepting any new programs from other ministries would result in reduced allocations.

A note exhibited by Mr. Ashok during the Assembly debate on drought said that the state has no scope to borrow more money to fund new projects.

He read from a finance ministry note: “The state government has a balance sheet cost of works of more than ₹2,00,000 crore. The outstanding bills from PWD, water resources, minor irrigation and RDPR alone are to the tune of ₹36,136 crore. They are already facing financial crunch including funds for salaries of power companies and transport and transport corporations.”

He said the note clearly stated that the fiscal deficit stood at 2.95% against the permitted level of 3%. The revenue shortfall stood at ₹ 22,957 crore and cumulative liabilities compared to GSDP touched 24.94% against the sanctioned level of 25%.

Describing the finance ministry note as a “slap to the government”, Mr Ashok noted that the note exposed the state government’s financial situation. Pointing out that the finance ministry’s note was issued on September 17, he wondered if the new proposals announced by the chief minister during his visit to Mangaluru and Kalaburagi would become a reality.

“The state has been hit by drought and farmers are moving. But the government’s coffers are empty and there is a financial drought,” he said.

Mr. Ashok alleged that despite the earlier drought warning from both the IMD and the Centre, the government did not take precautionary measures. Even the declaration of drought was delayed by four months, he said.

He accused the government of being apathetic about drought relief and claimed that the ruling Congress leaders themselves were worried about such an attitude. “Senior MLA HK Patil has warned that he will resign if Gadag district is not included in the drought-hit list. Another senior leader Appaji Nadagouda said he will go on hunger strike. This clearly shows that the Congress MLAs themselves are upset with the government’s inaction on drought relief,” he said.

Published – 22 Sep 2026 22:37 IST