🧾 Article 293 of the Indian Constitution
Title: Borrowing by States
🔍 Explanation:
Article 293 governs the borrowing powers of State Governments in India. It provides rules under which States may:
-
Borrow money within India (but not abroad),
-
And sets conditions when the State is already indebted to the Central Government.
📘 Key Provisions of Article 293:
| Clause | Provision |
|---|---|
| (1) | A State may borrow money within the territory of India on the security of the Consolidated Fund of the State. |
| (2) | The State may give guarantees within India for loans. |
| (3) | If a State is indebted to the Union or has taken loans guaranteed by the Union, it must get prior consent of the Central Government before borrowing more. |
| (4) | The Union Government may impose conditions when granting consent for further borrowing. These conditions must be respected by the State. |
📊 Summary Chart: Article 293
| Feature | Details |
|---|---|
| Article | 293 |
| Applies To | State Governments |
| Where Can States Borrow? | Within India only |
| Security Used | Consolidated Fund of the State |
| Consent Requirement | Required only if the State is already indebted to the Union |
| Union’s Control | Can grant or deny consent, and impose conditions |
| Foreign Borrowing | ❌ Not allowed directly under Article 293 |
| Objective | Ensure financial discipline and Centre–State fiscal balance |
🧠 Why Article 293 is Important:
-
Prevents States from overspending and falling into debt traps.
-
Ensures Central oversight when public money is involved.
-
Maintains national fiscal stability and coordinated economic policy.
Follow Us