Andhra Pradesh

‘Raising loans against FRBM norms warrants special audit by CAG’

BJP Rajya Sabha member G.V.L. Narasimha Rao has alleged that the Andhra Pradesh government is raising loans over and above the Fiscal Responsibility and Budget Management (FRBM) limits in blatant violation of norms for implementing the promises made during the elections, instead of mobilising resources through proper channels.

Addressing the media in New Delhi on Sunday, Mr. Narasimha Rao said a special audit should be done by the Comptroller and Auditor General (CAG) and also the Reserve Bank of India (RBI) as a substantial chunk of the debt was raised from the banks.

‘Guidelines needed’

He also stressed the need for the Central government to prescribe guidelines for direct cash transfers to the beneficiaries under various schemes.

Mr. Narasimha Rao said the borrowing of huge sums through the AP State Development Corporation, whose functions and objectives were under a cloud and whose very formation was challenged in the High Court, should also be probed.

He observed that the the State government was raising debt through “creative accounting systems,” and then diverting the money for purposes other than those they were intended for.

The government was scouting for new loans every day, rather than first setting its house in order, and it was least bothered about the consequences of its fiscal profligacy, he alleged.

The resources were being used to build vote banks, Mr. Narasimha Rao said, while taking strong objection to the practice of setting aside monies that were supposed to go into the Consolidated Fund.

‘Dubious approach’

Mr. Narasimha Rao further said the guarantees being given by the State government for raising loans and the conditions agreed there upon should also be investigated, as the debt that was piling up had far-reaching implications.

The BJP MP said he would take the “dubious” manner in which the State government was mobilising funds to the Union Finance Minister’s notice to ensure that the Centre took corrective action lest the State should go deeper into crisis.


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Printable version | Sep 17, 2021 7:27:47 PM | https://www.thehindu.com/news/national/andhra-pradesh/raising-loans-against-frbm-norms-warrants-special-audit-by-cag/article35529963.ece

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