VIJAYAWADA: The economy of Andhra Pradesh has derailed, and the State has been burdened with Rs 9,74,556 crore debt during the YS Jagan Mohan Reddy government, said Chief Minister N Chandrababu Naidu while presenting a white paper on ‘State Finances’ in the Legislative Assembly on Friday.
The last of the seven white papers released by the TDP-led NDA government to expose the failures of the previous YSRC regime on various fronts, explained how the State was pushed into a per capita debt of Rs 1,44,336, posing a challenging task to the present dispensation.
Naidu began his presentation by explaining how the State was left in dire straits following the irrational bifurcation, and the five-year struggle to bring it back on the right track by attracting investments from across the world.
At length, he explained the State’s growth story from 2014 to 2019 with emphasis on infrastructure development, industrial growth and people’s welfare. The highest-ever expenditure of Rs 48,000 crore was made on the irrigation sector.
He highlighted how the state stood first in the country for four of the five years of the NDA regime (2014-19) in Ease of Doing Business, provision of skill training to eight lakh people, allotment of 14,213 acres of land to 1,945 industrial units, and marquee companies Kia Motors, Hero Motors, Asian Paints, Isuzu Motors, Apollo Tyres, Foxconn, etc starting commercial production in the State.
Andhra Pradesh was made a power surplus State by 2019 from 22.5 MU deficit per day in 2014. However, all the growth efforts came to naught after the change of guard in the State in 2019, and the following five years scripted the destruction of the State’s economy, he said, and added that there was a decline of growth in agriculture and service sectors.
Elaborating on the misgovernance of the previous dispensation, the Chief Minister said the power cost increased due to short-term purchases, and as a result, there was an additional burden of Rs 12,250 crore. There was a loss of Rs 7,000 crore due to illegal sand mining, and a Rs 5 crore penalty due to mangroves destruction. Cancellation of contracts in Amaravati, Polavaram and the energy sector had resulted in a loss of investors’ confidence.
“The inefficient governance led to Rs 1.29 lakh crore loss in power sector. As for Polavaram, Rs 45,000 crore loss was incurred due to the delay in creating ayacut, Rs 4,900 crore loss due to damages and repairs, and Rs 3,000 crore loss due to delay in hydel power generation. No major new industry/infrastructure project was taken up in the State during the previous regime. Central schemes funds, including State share of Rs 6,600 crore were not released,” he elaborated.
DBT schemes were supposed to increase wealth in the hands of people. However, the per capita income growth had declined during the previous regime. DBT expenditure led to an increase in borrowings. This has increased per capita debt, he pointed out.
Naidu also highlighted the diversion of funds from the State’s institutional bodies to the AP State Financial Services Corporation Ltd, the mortgage of government-owned properties for securing bank loans, the diversion of local body funds / employee savings / CSS matching grants, spending beyond means by the YSRC government during 2019-24, diversion of taxes through APSBCL and APSDC, sacrificing future revenue of 15 years by diverting ARET (Additional Retail Excise Tax), diversion of local body funds and employee savings.
The Chief Minister said a total of 24,988 cases were filed against the finance department and the liabilities payable due to court orders were Rs 3,542 crore. A huge number of contempt cases with personal appearances and arrest warrants against senior officials resulted in systematic humiliation and demoralised administration, he added.
“Capital Spending reduced by 60% in the last five years, vis a vis 2014-19. Departments, such as transport, Roads & Buildings, and Water Resources, that undertake substantial capital works were left critically short of funds to carry out relevant development works. In short, the financial crisis has brought Andhra Pradesh to a grinding halt, and left it in a vicious circle of debt trap,” the Chief Minister said, and urged the members of the House and people of the State to cooperate in overcoming the financial crisis and rising up to the challenge to put the State back on track of development.
