HYDERABAD: Here is good news and bad news. The whopping debt burden of Rs 1.50 lakh crore, which is equal to the size of the state’s annual budget, will not pose a major problem to Telangana at least for the next couple of years. But repaying the principal and interest amounts will definitely pose a problem in future.
The relief, albeit temporary, from debt burden is because of the state’s growing economy. “There is a moratorium for three years on repayment of loans taken for Mission Bhagiratha and other schemes,” an official in the finance department told Express, adding that the TRS government would not feel the pinch of debt till its present term expires. However, the interest burden will be much bigger after 2020, sources said.
In the 2017-18 budget estimates, the amount earmarked for payment of interest is Rs 11,138 crore.
The debts transferred to Telangana from united Andhra Pradesh were around Rs 70,000 crore. But, the accumulated debts as of March 2017 were Rs 1.14 lakh crore. It means that TS borrowed more than half of the debts taken in all the past years. This year alone, the state proposed to borrow Rs 36,000 crore.
While, the entire opposition termed the TRS government as “Baakeela” (debts) government, IT minister KT Rama Rao defended the state obtaining huge loans. “The debt burden of Telangana is less when compared to many other states in the country,” he claimed.
“Investments have to be made to improve basic infrastructure, implement employment-generative schemes, encourage people to turn entrepreneurial, improve amenities and raise people’s standard of living. Otherwise, the growing economy will flounder,” Rama Rao explained.
Besides the debt burden, the 20 per cent extra revenues projected in the budget are also unlikely to be realised.
The state is expecting around Rs 11,000 crore from the central government for Mission Bhagiratha.
“NITI Aayog recommended to the finance ministry to sanction funds for Mission Bhagiratha and Mission Kakatiya. We hope that the Centre will release the funds. That is why we have made provisions accordingly,” finance minister Etela Rajender said.
However, sources in the finance department said that the other revenue projects with regard to state own tax revenue (SoTR) and state own revenue (SOR) would be realised as per the projections.