1) A State requires the Centre’s consent for internal borrowing if it owes any debt to the Centre.
2) No State can raise loans from foreign sources without prior approval of the Union Government.
Borrowing Powers of Indian States
Article 293 of the Constitution of India governs the borrowing powers of the States.
Analysis of Statement 1
Statement 1: A State requires the Centre’s consent for internal borrowing if it owes any debt to the Centre.
Explanation: According to Article 293(4), if a State has any outstanding loan from the Government of India or has outstanding guarantees involving the Government of India, it cannot raise any loan (including internal borrowing) without the consent of the Union Government. This makes Statement 1 correct.
Analysis of Statement 2
Statement 2: No State can raise loans from foreign sources without prior approval of the Union Government.
Explanation: Article 293(4) generally requires the consent of the Union Government for a State to raise any loan if outstanding debts or guarantees involving the Centre exist. Moreover, managing foreign borrowing falls under the Union Government's domain concerning foreign relations and national economic policy. Thus, States invariably need the Union Government's approval for foreign loans. This makes Statement 2 correct.
Conclusion
Based on the constitutional provisions under Article 293, both statements accurately reflect the conditions governing the borrowing powers of Indian States.
Similar Questions
- Which major legal framework does the Bharatiya Sakshya Adhiniyam, 2023, seek to align with in recognizing electronic evidence?
- Which Indian state has become the first to implement the Uniform Civil Code (UCC)?
- Under which constitutional provision can the President of India assume legislative powers for a state?
Read the below statements marked as Assertion (A) and Reason (R). Mark the correct options:
Assertion (A): A confession made to a police officer is inadmissible in court.
Reason (R): Section 23 of Bharatiya Sakshya Adhiniyam retains the principle of voluntariness in confession.
- What makes the Goa Civil Code distinct from other personal laws in India?
- Which All-India Service is allotted to State cadres but controlled jointly by Centre and State?
Which of the following statements is/are correct regarding the role of the Rajya Sabha in special legislative and emergency situations?
1) Under Article 249, a Rajya Sabha resolution allowing Parliament to legislate on State List subjects remains valid for one year.
2) The Parliament can extend a proclamation of President's Rule only with the concurrence of the Rajya Sabha.
Consider the following statements:
1. Article 310 is derived from British constitutional practice.
2. It grants absolute power to remove civil servants without inquiry.
3. Article 311 limits the scope of Article 310.
Which of the above is/are correct?
- Which of the following accurately describes the legal and institutional basis of "Special Category State" status in India?
Which Constitutional Amendment made it mandatory for States to establish Panchayati Raj Institutions as units of local self-governance?
Important Questions from Polity
In a recent judgement, the Supreme Court of India directed that every protected forest, national park and wildlife sanctuary across the country should have a mandatory eco-sensitive zone (ESZ) of a minimum of
Which one of the following Directive Principles was inserted by the Constitution (42 nd Amendment) Act, 1976?
A common High Court for two or more states can be established by:
Which one among the following is not a Fundamental Right under the Constitution of India?
The Central Vigilance Commission was established on the recommendation of which one of the following Committees?
