Vijayawada: The state government defended borrowing of amounts against the backdrop of severe pandemic but stressed that the amounts directly went into the hands of people which helped the public to cope with the financial crisis induced by Covid-19.
Addressing a press meet here on Wednesday, special secretary to the Chief Minister on finance and economic affairs Krishna Duvvuri said that Union government’s CAGR (compounded annual growth rate) was 9.78 per cent during 2014-19 and during the same period, the debt of Andhra Pradesh government led by the Telugu Desam was at a CAGR of 17.33 per cent which was significantly higher (almost double) but now despite borrowing of amounts, the CAGR was 15.26per cent which was lower than 17.15 per cent of the Union government. He said the Opposition parties were alleging that borrowing exceeded limits but there were no allegations of siphoning as the money directly benefited people in times of pandemic.
Krishna said the outbreak of the Covid-19 pandemic had the most damaging impact on the state finances as it lost Rs 7,780 crore on account of state’s share in Central taxes, Rs 7,000 crore on account of own revenues and in addition to this, the state had to incur Covid-related expenditure to the tune of Rs 8,000 crore. Despite the huge fiscal disability, the present government believed that during these devastating times of loss of livelihoods, the only way to protect the people from utter distress was through the channel of DBT (direct benefit transfer). The government succeeded in placing money in the hands of people in an objective and transparent manner and thereby helping people in the hour of crisis, he said.
Krishna said the misgovernance and expenditure profligacy of the Telugu Desam government had resulted in the undue swelling of the liabilities of the state. At the time of bifurcation, the debt of combined state assigned to the government of successor state of Andhra Pradesh was Rs. 97,123 crore and when the public account share was also added to the same, the figure was Rs 1,20,556 crore, and the same had, over the past five years increased to Rs 2,68,225 crore. The story did not end here, he said and added that in addition to the above, owing to the TDP’s misgovernance during 2014-19, the state had to endure the burden of many more additional liabilities.
Krishna explained that the outstanding payables as on March 31, 2019, were to the tune of Rs 39,000 crores. The off-budget borrowings were to the tune of Rs 58,000 crores, and the same were Rs 14,028 crore at the time of bifurcation. Further, the debt in the books of the power sector corporations increased from Rs 33,587.98 crore to Rs 70,254 crore over the five-year period of 2014- 19. In addition to the above, dues by the DISCOMs to the power generators increased from Rs 2,893.23 crore to Rs 21,540.96 crore during the five-year period. He stated that it was pertinent to note that this heavy borrowings in AP took place during a time when this level of increase in debt was not witnessed anywhere else in the country. He explained that the debt of the Central government had increased at a CAGR of 9.78 per cent during the period 2014-19 and during the same period, the debt of Andhra Pradesh government had increased at a CAGR of 17.33 per cent, which was significantly higher (almost double) during the TDP rule.
Krishna analysed that during 2014-19, had this borrowing supported productive expenditure, various sectors in the state would have been substantially improved. Agriculture, health and education fared poorly due to the misgovernance of the TDP government. He stated that NABARD All India Rural Financial Inclusion Survey, 2016-17 indicated that indebtedness amongst agricultural households in Andhra Pradesh was as high as 77 per cent, when compared to the national average of 47 per cent and education gross enrolment rate (GER) for AP in primary education was amongst the lowest in the country at 84.48, as against the national average of 99. He further stated that this surely raised the question as to what was the true purpose of the huge expenditure by the TDP government.
Explaining that the TDP government’s borrowings was in excess to what was permitted by the Central government in accordance with Article 293(3) of the Constitution of India, Krishna said Rs 17,983 crore that the Centre was seeking to reduce the borrowing space for the state under which Rs 16,418 crore pertained to the period of the TDP government....