Harish Rao rebuts Congress, BJP views on borrowings

He suggests BJP to pursue release of funds due from Centre

Minister for Finance T. Harish Rao said that the Opposition Congress and the Bharatiya Janata Party (BJP) have tried to mislead the House and the people by speaking out only the selective information about the Budget estimates and not the complete picture.

In his reply to the discussion on General Budget and the Annual Financial Statement for 2021-22 in the Assembly on Monday, the Minister said the two parties had tried to paint even the temporary borrowings from the RBI, in the form of fixed deposit receipts/special drawing facility, ways and means and overdraft, as the debt. However, the fact remains that such borrowings were adjusted (cut) immediately by the RBI from the current account of the State government as when it receives funds every month, he explained.

“Although such an attempt to paint a wrong picture was expected from new member M. Raghunandan Rao (BJP), but it was not expected from a seasoned legislator like M. Bhatti Vikramarka (Congress). Such borrowings were also mentioned in the budget books as the floating debt and for 2019-20 it amounted to ₹37,247.59 crore,” Mr. Harish Rao said.

Giving further clarity on the State’s borrowings, the Minister stated that it was the RBI that would decide the quantum and any State would not be allowed to have their way indiscriminately. “Telangana is in the fourth position from bottom in terms of borrowings — GSDP versus percentage of debt — with 22.8%, while the Congress-ruled State of Punjab was third from the top with 38.7% borrowings of its GSDP and Rajasthan was in eighth position with 34.7%.”

Similarly, Chhattisgarh was in the 18th position from top and Telangana was at 25th place even after the increased FRBM (Fiscal Responsibility and Budget Management) from 3% of GSDP to 5% of GSDP, the Minister said. Besides, the borrowings of corporations with the State as the guarantor was also not part of the debt as they were repaid by the agency concerned — like the Civil Supplies Corporation repaying loans borrowed for paddy procurement after getting the money from FCI following supply of rice.

On sourcing of revenue during 2021-22, the Minister said the government was planning to mobilise about ₹16,000 crore through sale of lands and disposal of other non-performing assets such as Rajiv Swagruha units and Housing Board lands. New mining policy would also be brought to improve revenue through auction of mines.

Asking the BJP members to pursue release of funds due to Telangana from the Centre if they were sincere about the State’s development instead of making allegations, Mr. Harish Rao said Telangana would have received a total of ₹28,225 crore had the Centre accepted NITI Aayog recommendations and dues of Finance Commission and Backward Regions Grant funds.

Besides, Central devolution to State was down by ₹24,000 crore for the five-year period following the 15th Finance Commission recommendations. However, the same Centre was sitting on other recommendations of 15th FC such as sector-specific grant of ₹3,024 crore and State-specific grant of ₹2,350 crore to Telangana.

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