The state's
economy gave "a sense of gloom and doom" due to the "twin
burdens" of a decade of Congress misgovernance and bifurcation of the
state besides a Rs 18,236 crore "resource gap" during the current
year, Andhra Pradesh Chief Minister N Chandrababu Naidu said here today.
However, releasing a "white paper" on the state's finances here today
evening, the AP Chief Minister did not mention how implementing the promised
loan waiver to farmers, womens' self-help groups and weavers, would bleed the
state's exchequer further by nearly Rs 1 lakh crore. "Since 2008-09, the
state had been characterised by misgovernance, corruption scandals, and lack of
development and strategic direction. The subsequent political upheaval due to
the state's bifurcation, also seriously affected the economy, stalled growth
momentum, undermined AP's reputation and standing as a model of good governance
and development," Chandrababu said. The overall slowdown in the national
economy, contraction of job opportunities and consistently high levels of
inflation compounded the crisis and created a sense of gloom and doom, he said.
"The sense of alienation and despondency was further compounded by the
manner in which the state was reorganised by the UPA government at the Centre.
The state was divided without an iota of concern for, or attention to, the
disastrous economic and financial consequences for the residual state of Andhra
Pradesh," he said. "The resource gap for the current year was
estimated at Rs 18,236 crore, which translated to a revenue deficit of 4.84 per
cent and fiscal deficit of 7.18 per cent. Resource gap for the ten-month period
of the current fiscal is around Rs 15,691 crore, compared to a Rs 3,555 crore
surplus for Telangana. The current context has positioned Andhra Pradesh in a
fiscally precarious position," Chandrababu said.
As against
the requirement of over Rs 32,000 crore under the plan, only Rs 5,791 crore is
available to Andhra Pradesh. "Approximately Rs 26,000 crore is required
additionally over and above the borrowing limit approved by the Government of
India for the current year. This would require relaxation of borrowing limits
imposed by the Fiscal Responsibility and Budget Management Act," he said.
"So far, market borrowings are strictly used for capital expenditure. A
stage has come now, wherein we will have to borrow significant amount for
revenue expenditure without any asset creation. A continuation of this trend
may lead to fiscal imbalances, which may cause irreparable damage to the
economy and adversely affect growth and development of the state," he
said. The Chief Minister, however, said his government was committed to rectify
fiscal imbalances which emerged during the past few years. "The task ahead
is very arduous. The government may be left with difficult and painful options.
We seek co-operation and support of the people to move towards the course of
fiscal correction," he said. Chandrababu said the government is "not
contemplating" any fresh taxes since the previous Congress government had
already resorted to irrational tax hikes. "It is significant to note that
the per capita taxation in the state shot up more than three-fold from Rs
2,266.90 in 2000-01 to Rs 7,136.76 by 2010-11. The per capita debt also saw a
three-fold increase from Rs 7,712 in 2003-04 to Rs 20,573 in 2013-14,"
Chandrababu said. The Chief Minister said the government is exploring various
options to mobilise financial resources and boost the economy. "I will
spell out my approach soon after the series of white papers (on various subjects)
are released," he said. AP Finance Minister Yanamala Ramakrishnudu,
Principal Finance Secretary Ajeya Kallam, Principal Secretary P V Ramesh and
others were present on the occassion.
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