TDP blamed for State’s financial woes
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During its term, the borrowings had exceeded the permitted limit, says Special Secretary to CM
Reiterating that much of the State’s financial woes were the result of “fiscal profligacy” of the previous TDP government, Krishna Duvvuri, Special Secretary to Chief Minister (finance and economic affairs), asserted on Wednesday that bifurcation of Andhra Pradesh (AP) had caused severe distress on account of a debt of ₹97,123 crore assigned at that time, which increased to ₹1,20,556 crore due to the sharing of public account, and the overall debt ballooning to ₹2,68,225 crore since 2015-16.
Mr. Krishna claimed that the per capita revenue of Telangana was ₹15,454 at the time of bifurcation against A.P.’s ₹8,979.
This largely reflected the miserable situation in which the State was mired right from the day of becoming the “successor State of A.P.,” Mr. Krishna said while addressing the media here.
Mr. Krishna said the outstanding payables as on March 31, 2019, were ₹39,000 crore and the off-budget borrowings stood at ₹58,000 crore, up from ₹14,028 crore at the time of bifurcation.
The debt on the books of power utilities increased from ₹33,587.98 crore to ₹70,254 crore between 2014 and 2019.
Spike in Centre’s debt
Mr. Krishna affirmed that the heavy borrowings being “blown out of proportion by a section of the media” had taken place at a time when the Government of India itself had witnessed a sharp spike in its debt at a Compounded Annual Growth Rate (CAGR) of 9.78% in 2014-19.
The A.P. government’s debt increased at a CAGR of 17.33% during the same period, he added.
“During every year of the TDP term, the borrowings were over and above what had been permitted by the Central government. As a consequence, the present government is bogged down by a massive debt burden,” Mr. Krishna said.
The entire country was in the grip of a cyclical slowdown in 2019-20. The growth in union tax revenue recorded that year was the lowest in the last two decades, he asserted.
Mr. Krishna said the State government had to give a boost to the public consumption expenditure, which had nosedived during the pandemic, by putting money in the hands of people through Direct Benefit Transfer (DBT), which was an effective way to prop the sagging economy.
“In spite of the severely constrained fiscal space, the present government did everything in a transparent manner to support the people. The fact to be underlined is that still, the CAGR of the State debt during these two financial years is lower than that of the Central government,” he added.
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