Andhra Pradesh faces debt burden of Rs 3.73 lakh crore: CAG
In November alone, the government borrowed Rs 13,001 crore to pay the gift bill.
Against the target of Rs 18,434.15 crore for the full year, the revenue shortfall soared to Rs 57,925.47 crore by the end of November itself.
The state government has borrowed Rs 9,226.375 crore on average per month so far in the financial year 2020-21.
The current borrowing trend indicates that the state government could raise a loan of at least another Rs 30,000 crore by the end of March 2021, bringing the total borrowing to over 1.04 crore of rupees in the financial year 2020-21, according to Ministry of Finance sources. noted.
AP’s debt burden was Rs 97,000 crore at the time of the fork in June 2014. In five years (to March 2019), it peaked at Rs 2,58,928 crore.
From April 2019 to November 2020, Rs 1,14,212.81 crore was borrowed from banks and other sources, of which Rs 1,06,866.25 crore secured by the YS Jagan Mohan Reddy scheme since June 2019, have indicated the sources.
In the first eight months of the current financial year, the state government incurred revenue expenditure of Rs 70,082.90 crore, almost all of which went to the many ruling YSR Congress giveaway schemes .
Previously, the Jaganmohan Reddy regime imposed taxes and duties totaling around Rs 21,000 crore on the people, citing revenue shortfall due to the Covid-induced lockdown.
Despite the lockdown during the first quarter of the financial year, government revenue reached Rs 46,589 crore in November, about Rs 4,500 crore lower than the corresponding period of the previous year.
The state also secured an additional Rs 8,000 crore in grants from the Center over the corresponding period.
The government has set up a new entity called State Development Corporation exclusively to raise loans and so far it has secured Rs 10,000 crore from SBI,
and , Department of Finance sources added.
The administration is waiting for the SBI to release another loan tranche of Rs 3,000 crore as another round of giveaways begins with the Rs 6,500 crore Amma Vodi scheme under which more than 43 lakh mothers would be paid Rs 15,000 each to send their children to school.
But only Rs 14,000 will actually be paid to the mothers, as the government will deduct Rs 1,000 from the Toilet Development Fund.
“The way things are going reminds me of a Telugu film we were shown during training at the Lal Bahadur Shastri National Academy of Administration. It’s something like Appu Chesi…which means living with debt,” noted a senior IAS officer.
Senior officials point out that the state will have to shell out almost Rs 35,000 crore a year from next financial year just for interest on existing loans.
“Given our own resources, central grants and expenditures for salaries, pensions and various allowances, we will be required to raise more loans, even for debt servicing.
This is what you call the classic debt trap,” lamented a senior official.
Former Finance Minister Yanamala Ramakrishnudu expressed his anguish over the financial situation of the state as the budget deficit was about to hit Rs 1,10,320 crore.
“Over the past 19 months, the government has borrowed Rs 1.5 lakh crore in addition to imposing a tax burden of Rs 75,000 crore on the people.
This is despite a 6% revenue growth in the first six months of the current fiscal year,” Yanamala pointed out.
The PA has now become the state with maximum borrowing and minimum development due to the “twisted policies” of Jaganmohan Reddy, the opposition leader in the Legislative Council has said.
When contacted, Finance Minister Buggana Rajendranath Reddy did not answer questions about state finances.