The borrowings of the Andhra Pradesh government have exceeded its revenue receipts, and this is leading to an extraordinary financial crisis, which may further lead to bankruptcy, says senior Telugu Desam Party leader and former Finance Minister Yanamala Ramakrishnudu.
Addressing the media here on Saturday (November 5), Mr. Ramakrishnudu said the government had deviated from the cardinal economic principle of using borrowings for asset creation. “Instead, it is diverting all borrowings for unproductive purposes. It has already crossed all the debt barriers, and is moving fast towards bankruptcy,” he said.
According to him, in the last six months the YSRCP government has borrowed about ₹58,000 crore under the Open Market Borrowings (OMB) against the budgeted allocation for ₹48,000 crore. And by the end of the financial year, the borrowings would cross the ₹1 lakh-crore mark, which was double the budgeted allocation, the TDP leader said.
This apart, the government had availed Off-Budget Borrowings (OBB) of ₹4.4 lakh crore. Together with the OMB, the total borrowings in the last three-and-a-half years was about ₹8.52 lakh crore.
“As far as the OBB is concerned, the government has gone against the financial norm to increase the borrowing limit from 90% to 180%,” he said.
“At this rate, by the time the term of this government is over, the total borrowings will be more than ₹10 lakh crore. The government that comes to power next, whoever it may be, will have to repay ₹1 lakh crore per annum. This is a Herculean task when the total budget of the State is around ₹3 lakh crore,” he said.
‘Negative growth rate’
Referring to the growth rate, Mr. Ramakrishnudu said, “When we (the TDP) handed over power to the YSRCP in 2019, the growth rate was around 10.22%. And now, it is minus 1.8%, which clearly shows that Chief Minister Y.S. Jagan Mohan Reddy is either ignorant of the facts, or is telling lies.”
The TDP leader also pointed out that in the Direct Benefit Transfer (DBT) scheme, Andhra Pradesh was in the ninth position. “In the Human Development Index, the State is ticking at 13%. In poverty, it is as high as 21% and in inequality of wealth, it has gone up from 33% to 43%,” the TDP leader claimed.
“These statistics are from reputed organisations, including the World Bank, and they indicate the pathetic condition of the State,” he said.
During the TDP rule, the per capita income was in double digits. But now, it slipped to single digit, and inflation was hovering over 8.1 %, said the former Finance Minister.
“If the DBT is a success story as is being claimed by the Chief Minister, why is poverty around 21% and inequality around 43%.? This clearly indicates large-scale corruption and the poor are becoming poorer under the YSRCP rule,” Mr. Ramakrishnudu said.
Unemployment
The Chief Minister had put development on the back-burner, and was focussing on vengeful politics, he alleged. “Roads are in a bad shape, unemployment rate is around 12.5%, youth are a frustrated lot, and private investors are not keen on investing in the State,” he said.
The much thought-after Economic Development Board (EDB), which was constituted by the TDP government, had become defunct, and there was no thought process going into developing industries and promoting the manufacturing sector, he said.
“The only thing that is happening is acquisition of assets in benami names by the YSRCP leaders. That is why there is a sudden increase in the ‘Nouveau riche’ category in society,” he alleged.
Mr. Ramakrishnudu demanded the government release a White Paper on the ₹85,000 crore “that has gone missing from the accounts.”
“Not only the opposition parties, even CAG, a constitutional body, has been demanding the government to submit a detailed clarification. But till date, there is no response,” he alleged.
