Madhya Pradesh Faces ₹12,000 Crore Loss Due to GST 2.0
Major Financial Impact: The implementation of GST 2.0 has significantly affected the financial condition of Madhya Pradesh. Due to the new rules, the state is facing a loss of ₹12,000 crore.
As a result, the state government will now have to impose major cuts in its expenditures. According to media reports, there has been a 12–13% reduction in the share from the central government. This has forced the state to halt major expenses such as:
- Vehicle purchases
- Construction of new government offices
- Printing of diaries and calendars
- Foreign trips by government officials
- Large public events and programs
The government had recently planned to distribute new uniforms for police and other departments, but this initiative is now likely to be postponed as well. New projects and schemes will now have to wait for funding.
Increased Pressure on MP's Economy
With the decrease in GST compensation, the direct impact will be on development programs and employee allowances. Previously, Madhya Pradesh used to receive around ₹12,000 crore annually in compensation, but that support has now seen a steep cut.
Strict Measures on Spending
To control unnecessary expenditures in government departments, strict orders have been issued, including:
- Vehicle purchase ban
- Delay in new office constructions
- Suspension of diary and calendar printing
- Foreign travel restrictions
- Control on large-scale government events
Upcoming Challenges
According to finance department officials, the state government will now need to reset its priorities. Essential welfare schemes and necessary programs will be given importance, while less urgent expenses will be slashed.