With Andhra Pradesh staring at the gaping revenue and fiscal deficits in the budget for 2015-16 presented by Finance Minister Yanamala Ramakrishnudu even after curtailing non-plan expenditure, government is gearing up to represent to the Centre the need for handholding for the beleaguered State.
The united State of Andhra Pradesh was a revenue surplus State but post division, the residuary State of A.P. turned into a huge revenue deficit State with no reasonable resources to build the infrastructure and pave way for economic growth and bring down the revenue deficit with every budget.
The government did manage to bring down the revenue deficit to Rs.7,300 crore from that of Rs.14,252 crore of 2014-15 and the fiscal deficit to Rs.17,584 crore from Rs.20,320 crore (as per revised estimates of 2014-15) that is about three per cent of GSDP. An effort has been made to send a message that the State did its best and it was now for the Centre to do the handholding to enable the State shed its revenue deficit status in the next three to four years. The allocation of Rs.22,113 crore towards revenue-deficit grant by the 14{+t}{+h}Finance Commission over next five years would be too meagre and the State would be forced to step up its borrowings to meet its revenue expenditure, the Minister noted.
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While it is praiseworthy that the Finance Minister could tame the revenue and fiscal deficit to acceptable levels by trimming the non-plan expenditure, he expressed concern that the State would continue to be a revenue deficit State even under the 15{+t}{+h}Finance Commission, ie from 2020-2025 if the promised grants, aid and incentives were not extended to the State at the earliest.