CM Revanth: High Interest Loans Repayment Hindering Telangana Growth, Meets EAC-PM Mahendra Dev

 Hyderabad: Chief Minister A. Revanth Reddy has raised serious concerns over the increasing financial burden on the state government due to the high interest rates on loans inherited from the previous BRS administration. In a meeting with Prof. S. Mahendra Dev, chairman of the Economic Advisory Council to the Prime Minister (EAC-PM), the CM spoke of the difficulty in loan repayment which, he said, was significantly hindering the state's development.

The Chief Minister requested the Centre's cooperation in reducing the burden of these high interest rates and rescheduling of the loans, as the repayment of these debts was consuming a substantial portion of the state's revenues. He highlighted that the financial strain was limiting the state's capacity to invest in development and infrastructure projects.

Revanth Reddy stressed the importance of maintaining mutual respect between the Union and state governments within the framework of the federal system. He stressed that the nation's progress depended on the development of its states. He also provided an update on Telangana's rapid growth and progress under his leadership.

Revanth Reddy informed Prof. Dev that the state's income was largely spent on servicing the loans, leaving little room for developmental activities. He also discussed the initiatives the government had taken to enhance urban infrastructure, particularly in Hyderabad, and the creation of employment opportunities through skill development programme.

The meeting touched upon the state's industrial development plans and the growth of the service sector. Revanth Reddy made a strong case for the construction of a Regional Ring Road around Hyderabad, along with radial roads to improve connectivity and ease traffic congestion.

Sandeep Kumar Sultania, principal secretary, finance, also present in the meeting.

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Big trouble

• In the Budget session in March, CM Revanth Reddy said that of the Rs 1.58 lakh crore loans taken by Congress government in 15 months, about Rs 1.53 lakh crore went to clear BRS government debts.

• On December 7, 2023, when the Congress assumed office, Telangana's debt was Rs 8,19,151 crore.

• This included Rs 6,69,257 crore in loans, Rs 40,154 crore in pending bills and Rs 1,09,740 crore in additional liabilities.

• Additional liabilities included obligations of discoms, Singareni Collieries and SC/ST sub-plan backlogs.

• Rs 8,000 crore unpaid retirement benefits of employees.

• From Dec. 2023 to Feb. 2025, Congress government borrowed Rs 1,58,041 crore

Rs 88,591 crore went towards repaying principal amounts, Rs 64,768 crore for interest payments.

Quote

"These figures indicate that the actual debt undertaken by our government is only Rs 4,682 crore, as the majority of borrowings were used to settle BRS-era loans. We have systematically repaid the BRS government's debts while ensuring financial stability for Telangana."

— Revanth Reddy

— Chief Minister, in Assembly in March