HYDERABAD: Just a few weeks before Chief Minister K Chandrasekhar Rao is to present the full Budget for the first time in the State Legislative Assembly, sources in the Finance Department confirmed on Saturday that “the State is under financial stress”.
The stress will increase from this year as the repayment of principal and interest amount on Mission Bhagiratha loan will start soon. The overall debt service in the current financial year would be around Rs 15,000 crore. The debt service would increase from Rs 17,000 crore to Rs 18,000 crore in the coming years.
Exactly two years ago, the Comptroller and Auditor General (CAG) had indicated that the debts would put a strain on the State Budget from 2019 onwards. Now, the State government is finding it difficult to pay the dues to Aarogyasri and Kanti Velugu dues, Kalyana Laxmi amounts and even the Rythu Bandhu programme. There were complaints that the Rythu Bandhu amount was deposited only into the accounts of the farmers who have five acres or less.
“I have eight acres of land, but I did not get the Rythu Bandhu amount so far. The officials said that the amount will be deposited whenever the State government releases the same,” a farmer said.
Small-time contractors of Mission Kakatiya third and fourth phase too were frequently meeting the officers for the release of their amounts ranging from Rs 1 lakh to Rs 8 lakh. “The financial stress is common. The small amounts will be released as and when money is available. Even the Central government is facing financial stress. When compared to the Centre, the State’s financial stress is very low,” sources in the Finance Department told Express.
The monthly debt-paying amount of the State government is around Rs 1,200 to Rs 1,400 crore. However, this year will be critical for the State government as the Central tax devolution was decreased by around Rs 840 crore in the full Budget of the Union government when compared with the vote on account Budget. “Crises will come and we will overcome them time to time,” a senior Finance Department official said.
The stress also increased on finances after the government enhanced the Aasara pensions and others. “Our debt to GSDP ratio is within the limits,” the sources said.
Asked about the borrowings outside the Budget, they said: “All the States are raising loans outside the Budget.” The sources said the GSDP of the State has doubled from Rs 4 lakh crore in 2014 to Rs 8.66 lakh crore in 2019. “Further growth is possible due to investments in Pharma City, Textile Park and NIMZ. Things will improve in the next four to five years.”