HYDERABAD: Faced with resource crunch and revenue deficit, the cash-starved Andhra Pradesh Government issued a circular directing all departments to halt projects taken up before June 2, the day state was bifurcated.
According to sources, the Finance Department directed all departments, especially Irrigation, Panchayat Raj and Housing, not to take up projects grounded before June 2.
This, in effect, means that the government has imposed a blanket ban on all the projects taken up by the previous Congress Government.
According to officials, only those viable projects which were announced after June 2 will now be entertained.
The government has also asked the heads of various departments to review all projects which have been completed up to 25 per cent and further directed them to sanction funds only to those projects whose works are progressing on schedule.
In an interesting development, the state government has also asked officials to stop works being taken up under the National Rural Employment Guarantee Scheme (NREGS) in the state.
According to sources, the decision will affect the works relating to about 7.95 lakh houses.
It is learnt that the government also has to make payments to the tune of `450 crore to contractors involved in the construction of houses under various schemes.
The payment will further be delayed due to the decision.
With respect to irrigation schemes, the state has 54 under-construction schemes.
With the Budget showing a revenue deficit of `6,064 crore, Chief Minister N Chandrababu Naidu is left with no other option but to stall projects which do not improve the state’s financial position.