VIJAYAWADA: Despite the huge fiscal disability due to the cyclical slowdown in 2019-20 and the Covid- 19 pandemic in 2020-21, the State government has not compromised on delivering on its commitments to the people, said Krishna Duvvuri, Special Secretary (Finance and Economic Affairs) to Chief Minister YS Jagan Mohan Reddy. He blamed the non-fulfillment of commitments made to AP during bifurcation and also the ‘misgovernance and expenditure profligacy of the previous TDP government’ for the undue swelling of liabilities of the State.
Speaking to mediapersons on Wednesday, he said the government believed that during the devastating time of loss of livelihoods, the only way to protect the people from utter distress is through direct benefit transfer. “Not only has the government succeeded in putting money in the hands of people in a transparent manner, but also ensured that there are no hiccups in implementing programmes such as Nadu-Nedu in health and education,” he said.
Taking strong exception to a misinformation campaign by the Opposition with regard to State finances and borrowings, Krishna clarified that like any other State or country, Andhra Pradesh too had borrowed, but within limits and its debt during the two financial years was lower than that of the Centre. As on March 31, 2021, the Centre’s debt growth was 37.24 percent and debt CAGR was 17.15 percent, while the State government’s debt growth was 32.84 percent and the debt CAGR was 15.26 percent, he said.
Cyclical slowdown
Elaborating further, he said the entire country was in the grip of cyclical slowdown in 2019-20 and the growth of Union tax revenue for that fiscal was the lowest in the last two decades. It was an unprecedented 3.38 percent. In the subsequent financial year, the entire world was in the grip of Covid-19 pandemic, the worst catastrophe ever. Krishna said for this very reason, not only India, but governments across the globe had to depend on heavy borrowing.
The Special Secretary said the State was also impacted by the cyclical slowdown in 2019- 20. Against the expected Rs 34,833 crore as its share in Central taxes, it had received only Rs 28,242 crore and it also witnessed a fall in its own revenues. In 2020-21, Covid-19 had the most damaging impact on the finances. “The State had lost Rs 7,780 crore in its share in Central taxes, Rs 7,000 crore on account of own revenues and moreover, it had to incur Covidrelated expenditure to the tune of Rs 8,000 crore. The loss on account of total economic impact would be much more,” he said.