As per a report of the 15th Finance Commission 'Finance Commission in COVID Times' Nagaland has the second-highest debt in the country. Though the State's Debt/GSDP had reduced from 55.5% in 2011–12 to 42.7 in 2018–19, 15 FC said that it was still much higher than the National Health Education Standards (NEHS) average of 29.61%.
It pointed out that debt should be consolidated in line with the new FRBM Act and the recommendations of FC-XV.
Further, the commission also noted that the State needed to restructure and rationalize its expenditure priorities. The committed expenditure (including GIA Salary) of Nagaland was 67.3% of its TRE in 2018–19 (all States average 50.6%), on the other hand, capital expenditure in Nagaland declined between 2011–12 and 2018–19, both as a percentage of GSDP (from 10.3% to 5.9%) and total expenditure (20.4% to 12.8%).
The report stated that the State need to take measures to reduce burden of committed expenditure to free up resources for development expenditure.
At the same time, the 15 FC said that the State also needed to reduce its infrastructure deficit by increasing capital expenditure and finding alternate sources of funding like PPP.
As per the Ranking in NITI Aayog's Sustainable Development Goals Index (2019), Nagaland was placed 19th out of 29 States. The State needs to ensure that the benefits of economic growth trickle down to all sections of society, the report stated.
