The Reserve Bank of India (RBI) has appreciated the efforts of Odisha Government in taking up reforms in financial management, which is helping the State recover from financial crisis

during Covid 19 pandemic.The RBI’s latest report on the State Finances and Experience of Odisha pointed out that the Government identified “fiscal risk management" as one of the key reforms suggested by the IMF South Asia Regional Training and Technical Assistance Center (SARTTAC) in 2019.

The State has adopted a three-stage approach to fiscal risk management with identification and measurement of fiscal risks, fiscal risk reporting and mitigation and management of fiscal risk.All possible sources of fiscal risk were identified and the impact of each fiscal risk worked out as ratio of GSDP and classified as high, medium and low on the basis of the level and possibility of occurrence.

The State Government also used the IMF's State-Owned Enterprise Health Check Tool to assess the financial health of the State PSUs.Fiscal risk reporting, critical approach for transparency and public disclosure are envisaged through a two-stage approach, remarked the RBI.

 First, a fiscal risk register as part of the mid-year fiscal strategy report identifying the sources of fiscal risks exposure and likelihood and severity of risk materialization has been put in place. Secondly, a fiscal risk statement to be released along with the annual budget documents would incorporate all possible fiscal risks for the State in quantified terms.

This statement would be a part of the disclosure that the government intends to bring out, starling from the financial year 2021-22. As a part of fiscal risk management measure for Covid-19 crisis, the State would utilise a portion of the CSF for amortisation of the entire open market borrowing during 2020-21.

The State intends to broad-base coverage of funds and uses them to address possible fiscal stresses in future, pointed out the RBI.