HYDERABAD: Against the backdrop of heightened tensions between the Bharatiya Janata Party (BJP)-led Centre and the Telangana Rashtra Samithi (TRS)-led State government, Chief Minister K Chandrasekhar Rao has decided to “expose” the saffron party on the floor of the Assembly.
Blaming the Centre for a revenue shortfall of Rs 40,000 crore in 2022-23 due to the conditions imposed by the Union government on a “progressing and performing” Telangana, the chief minister has decided to convene a week’s Assembly session in December. The objective is to bring to light the Centre’s “irrational and absurd economic policies”. According to an official release, the CM intends to talk about the “actions” of the Centre in detail during the session so that Telangana’s populace can grasp the situation.
The CM, on Thursday, directed Legislative Affairs Minister Vemula Prasanth Reddy and Finance Minister T Harish Rao to take necessary steps to convene the session.Rao is of the view that the Centre’s attitude has become an obstacle for the future and growth of the State.
FRBM limitations
States normally prepare budget estimates by taking the Fiscal Responsibility and Budget Management (FRBM) limit given by the Centre into consideration. However, with the change in FRBM limits this year, the State government’s budget took a hit. When the State proposed to raise Rs 54,000 crore in FRBM loans, the Centre limited it to Rs 39,000 crore.
As the State didn’t implement power sector reforms, it could not raise the additional 0.5 per cent FRBM loans this year, which resulted in a loss of Rs 6,000 crore. Besides, the Centre didn’t release around Rs 20,000 crore in non-budgetary funds. With this, the shortfall of revenue for the State in the current fiscal is estimated to be around Rs 40,000 crore.
“The Centre is undermining federalism by throttling the States’ voice and damaging all the States’ with its politically-motivated, vindictive and degenerate policies,” Rao commented.Sources pointed out that the Centre stopped the funds flow from other financial institutions such as the Power Finance Corporation (PFC). However, after the intervention of the CM, the PFC and other agencies are now releasing funds.
“At every step, the BJP-led Central government is obstructing the progress of the State. It is clear that the Centre is conspiring to dilute the potential of Telangana, which has set an example for the country with its outstanding progress in all fields,” Rao said.There is a lurking danger that the lopsided policies being pursued by the Union government prove to be detrimental to the development of the country, he added.The “ill-advised and irrational decisions” of the Centre are not only obstructing the econo-mic progress of Telangana but also that of the country, the CM said.
Mid-term review?
It may be recalled here that Harish presented a Rs 2.56 lakh crore budget for 2022-23. With the shortfall of Rs 40,000 crore, the budget size will reduce to Rs 2.16 lakh crore. Besides, the State estimated that it would receive Rs 41,000 crore grants-in-aid contributions this year, but it has only amassed Rs 5,507 crore till September this year. Thus, the shortfall would be another Rs 30,000 crore and the State’s budget size may further reduce to Rs 1.8 lakh crore to Rs 1.90 lakh crore.It remains to be seen whether the Assembly session would be confined to “exposing” the BJP-led Union government or undertake any mid-term review of the State budget.
The State government has ambitious plans in the pipeline such as Dalit Bandhu, construction of 2BHK houses under the Dignity Housing Scheme, crop loan waiver and others. The State will face a crunch of resources for these schemes. Sensing the danger at the beginning of this fiscal year, the State government decided to enhance its revenues by selling valuable lands and increasing the transport and registration charges.Though there is a significant increase in State’s Own Revenue (SOR), it’s not enough to meet the ambitious plans of the government in the implementation of welfare schemes.