Hyderabad: The next 24 hours are very crucial for the Andhra Pradesh government, which will get a clearer picture of its financial position. While the AP government's overdraft is increasing by the day, the Centre is not releasing any funds.
AP finance department principal secretary P.V. Ramesh rushed to Delhi on Monday as Tuesday is the last day of the current financial year. He will make final efforts to get funds for the state.
Meanwhile, the Centre has announced the release of Rs 1,500 crore towards construction of the new capital city. The Centre said Rs 500 crore is for the construction of Raj Bhavan, Assembly, Secretariat and High Court buildings and Rs 1,000 crore to create infrastructure facilities in the capital area.
The overdraft of AP government crossed Rs 4,000 crore on Monday. If the Centre does not release any funds the, overdraft will further increase to Rs 5,000 crore by Tuesday. Meanwhile the revenue deficit has reached Rs 17,000 crore against the estimation of Rs 6,064 core in the Budget.
Ten days ago, the Centre released Rs 500 crore to fill the revenue deficit. Now AP is expecting Rs 14,000 crore from the Centre to fill the gap of revenue deficit. AP government has to pay around Rs 6,000 crore to the Reserve Bank of India to clear its overdraft.
AP has taken Rs 1,540 crore as ways and means and special ways and means advances and further Rs 4,000 crore as over draft. The government has to clear the ways and means advances within 90 days and the overdraft within 14 days, otherwise the Reserve Bank will freeze all the state government’s bank accounts. AP government has decided to give priority to clear the advances taken from Reserve Bank rather than pay salaries to employees.
Under 13th finance commission recommendations the Centre has to release around Rs 1,000 crore to local bodies.
If the Centre does not release these funds by Tuesday all the funds will lapse. The Centre has assured releasing Rs 650 crore as CST compensation arrears.
