Arun Jaitley says Centre committed to Andhra Pradesh Reorganisation Act, solution to release funds 'being worked out'

New Delhi: A formula will soon be worked out to release funds under a special package to Andhra Pradesh, Finance Minister Arun Jaitley said on Tuesday, allaying the fears of parliamentarians from the state.

He made the statements in both Houses of Parliament where MPs belonging to the TDP, YSR Congress and the Congress have been protesting for the past two days over "non-implementation" of the Andhra Pradesh Reorganisation Act, demanding a financial package for the state from which Telangana was carved out and asking the government to "honour its commitments" at the time of bifurcation.

File image of Finance Minister Arun Jaitley. PTI

File image of Finance Minister Arun Jaitley. PTI

"I think a solution by which an amount can be given through an alternative mechanism is being worked out. I have asked the expenditure secretary on Tuesday to immediately call the finance secretary of Andhra Pradesh to Delhi and work out procedural formalities, so that it can be done," Jaitley said in Rajya Sabha after TDP members trooped into Well raising slogans over their demands.

"That amount will be the same. Let's be assured that there should not be any difficulty," he said.

Later, in the Lok Sabha too, Jaitley said he has asked the expenditure secretary to work for a mechanism to provide due funds to the state of Andhra Pradesh as extra-budgetary mechanism.

"We stand fully committed to every aspect of the Andhra Pradesh Reorganisation Act," he said.

Pacifying the protesting members, he said, "My friends from Andhra Pradesh are well aware that at least I have been fully sympathising and trying to make sure that every part of the Andhra Pradesh Reorganisation Act and the commitments made by central government at all stages are honoured. The central government fully stands by it."

Elaborating further, he said "there are two issues: institutions which have to be created, money under various heads which had to be given. One particular issue is how the amount in lieu of special status or special package has to be paid."

He said, "The state had requested for (funds) by way of externally-aided programmes. That is, in the normal central scheme is 60 percent from Centre and 40 percent to be borne by the state. But if it has a special status, it would have got 90 percent from the Centre. So the difference is 30 percent."

"In lieu of this 30 percent in five years, for that amount which is calculated, the state said that 'give us externally-aided projects which the Centre can fund with 90:10 (ratio)' so that the adequate compensation through the special package is also equivalent to special status. That was agreed upon," the finance minister said.

Elaborating further, he said the externally-aided projects are approved by external agencies like JICA or World Bank and "takes time".

"So the chief minister has written to me saying have it funded from NABARD. But once it is funded from NABARD, it creates a problem with regard to addition to fiscal deficit because in that case the borrowing space of the state itself would be contracted," Jaitley explained.


Updated Date: Feb 06, 2018 18:39 PM

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