Four years after bifurcation, Andhra Pradesh, Telangana staring at mounting public debt; complain of lower Central grants

Four years after their bifurcation, Andhra Pradhesh and Telangana are staring at mounting public debt with the former even splitting with the Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) ruling at the Centre over the issue of special category status to the state.

According to this report in the Hindu Business Line, AP’s public debt has increased to Rs 2,25,234 crore in the fiscal year 2017-18. Many key players in the state attribute this tremendous rise in public debt to absence of any special assistance from the Centre.

File image of Telangana Chief Minister K Chandrasekhar Rao. AFP.

File image of Telangana Chief Minister K Chandrasekhar Rao. AFP.

The Telugu Desam Party (TDP) led by chief minister Chandrababu Naidu has been at the forefront of years old agitation demanding a special category status for Andhra Pradesh. So far the demand has not been met which has also caused rift between TDP and NDA with the former severing the ties with the BJP-led government at the Centre.

Telangana, which was carved out of united Andhra Pradesh in June 2014 after decades of protests and agitation, has seen its public debt rising to 1.8 lakh crore over the past few years.

Akbaruddin Owasi, floor leader of the All India Majlis e Ittehadul Muslimeen (AIMIM) in Telangana assembly, while starting a debate on budget this year said that the total expenditure for the 2018-19 financial year was pegged at Rs 1.74 lakh crore.

With this the debt burden of the state was expected to rise to Rs 1.8 lakh crore, Owasi has been quoted in this The Hindu report as saying. According to Owaisi, the debt was apart from Rs 41,539 crore outstanding guarantees given by the government, The Hindu report further said.

The two southern Indian states allege that the Central government has turned a deaf year to their demands and despite they contributing large amount of money to the Central ex-chequer, they get little in terms of devolution from the Centre.

The special category status is given to a state that is demographically and historically at a disadvantageous position. Jammu and Kashmir was the first state which was accorded the special category given the state's history and terrain. After that the central government allotted 10 more states the same special category tag.

The Chandrababu Naid-led Andhra Pradesh while arguing in favour of the demand says that it was at the receiving end of the bifurcation as the common capital of Hyderabad now has gone to Telangana. Hyderabad has been a major source of revenue for the undivided Andhra Pradesh as the city has international reputation and a major tourist destination for domestic as well as foreign travellers.

Days after the Union Budget 2018 was presented in Parliament in February this year, Telangana had expressed its dissatisfaction over the way the Budget had dealt with various demands in the state. Telangana Finance Minister E Rajender had said the Union Budget 2018 does not address the needs of the state. He, however, welcomed the initiatives in the budget, such as minimum support price to farmers, health insurance to poor people and allocations to some of the agricultural allied fields, according to this PTI report.

"We sought funds for irrigation projects. We also sought financial assistance for Mission Bhagiratha and Mission Kakatiya. There was no mention of them in the budget speech. We are thoroughly disappointed," Rajender has been quoted by the news agency as saying.


Updated Date: Mar 20, 2018 16:51 PM

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