Friday, March 10 2006 18:37 Hrs (IST) - World Time -

Baramati (Maharashtra): Deputy Chairman of the Planning Commission Montek Singh Ahluwalia today(Mar 10,2006) said the state governments have huge cash balances with them and a reason for this could be they are spending less for development activities.

"If it (cash balance) is much much higher than last year, then definitely there is some feeling that we are not doing as much as with the resources available," he said on thesidelines of the Sixth Baramati Initiative on ICT and Development organised by Vidya Pratishthan Institute of Information Technology here.

However, the cash balance with the states could also be due to the build-up of payments, scheduled to be made at the end of the year.

"We don't know yet whether the cash balance is due to inadequate developmental activity or a temporary build-up of liquidity to pay back the bills at the end of the financial year," he said.

Ahluwalia maintained that large cash balances also suggested liquidity was not an issue.

"We cannot say the resources are a constraint," he said, adding as on February, the cash balance was three times higher than that of last year.