Tuesday, February 22 2005 11:43 Hrs (IST) - World Time -

Mumbai: Union Finance Minister P Chidambaram has communicated to Shiv Sena MP Mohan Rawale that Maharashtra Government does not meet the necessary condition for accessing Special Structural Adjustment Loan (SAL) from the World Bank.

Replying to a letter written by Sena MP on December 20, 2004 requesting for SAL for Maharashtra from the World Bank, Finance Minister said it was required to satisfy the necessary condition of annual reduction of 5 per cent in the ratio of revenue deficit to revenue receipts for a state to be eligible for SAL assistance.

Further, Chidambaram said, the State should have demonstrated adequate efforts in raising the tax and non-tax revenues, according to Rawale.

The Sena MP further said that the Finance Minister has pointed out that Maharashtra's revenue deficit to total revenue receipts has worsened over the last five years from 17 per cent in 1999 to about 24 per cent in 2003-04 while the State could raise its tax to GSDP ratio by only 0.22 per cent during the last five years.

"Instead the State's non-tax revenues have registered a decline both in absolute and percentage terms," Chidambaram said.

The Finance Minister said Maharashtra does not meet the necessary condition for accessing SAL and it is difficult for us to request the WB for SAL assistance, in relaxation with SAL guidelines.