Hyderabad 13th September : Telangana Finance Minister T.Harish Rao on Tuesday said that the Union government owes more than Rs 1 lakh crore to the state in the form of in-process grants, funds and compensation.He informed the Assembly that the Centre is owed $105,812 and that if the funds in limbo can be released, the state will be able to pay off one-third of its debt of Rs 3.29 crore debt.
If the Centre releases these funds, the state will not even have to take on additional debt, he said in his response to the brief debate on “Central government dual policy in the implementation of FRBM Act – Impact on progress of the state”
Harish Rao alleged that the unilateral decisions of the Centre and the imposition of restrictions on the state in obtaining loans within Fiscal Responsibility and Budget Management (FRBM) limits were having negative consequences for the state.
He denied the criticisms from the BJP regarding the state’s debts, and said that, unlike the Union government that received loans to repay its loans the state government used the borrowed funds on capital expenditure and also created assets.
He said that the state financed irrigation projects such as the Kaleshwaram project Mission Bhagiratha, Mission Kakatiya and other programmes that helped create assets for the state.
He said that according to the Reserve Bank of India report Telangana’s debt ranking is 23rd in the country.
Harish Rao also rubbished the claims made by the Union Finance Minister, Nirmala Sitharaman as well as other BJP leaders regarding the debt per capita on every state citizen of the state.
He said that although the Central debt resulted in the per capita debt of Rs 1,25,679 for every person, the debt in Telangana was to 94,272 per person.
During her recent visit Telangana Sitharaman stated that each baby born in Telangana is liable for an amount of the equivalent of 1.25 lakh.
Harish Rao stated that Telangana’s debt-to- GSDP ratio of 23.5 percent is lower than the ratio of the country of 55 per cent.
He claimed that in the last eight years, Telangana assumed top position in terms of increase in state-owned-tax-revenue with 11.5 per cent growth.Odisha was second with 9.7 percent being followed by Haryana with 9.2 percent growth.
The contribution of Telangana’s GDP has increased from 4% to 4.9 percent in the past eight years, even though it having only 2.9 percent of the country’s population.
“Unlike the BJP government, which revoked the corporate loans in order to benefit its supporters we shared the wealth of the State with the less fortunate,” he said.
Harish Rao reminded that the Comptroller and Auditor General (CAG) found fault with the Union government for obtaining loans that were not budgeted.
These totalled around six lakh crore in the last five-six years.
He stated that if BJP MPs and MLAs from the state achieve in getting fees from the Centre, he would felicitate the state’s MLAs and MPs.
The Finance Minister criticized the Centre for adopting two standards in the implementation of the FRBM Act by imposing restrictions on states, while not implementing them themselves.
He stated that the Centre took a unilateral choice to limit the state’s borrowings , without forming the committee in accordance with the recommendations of the 15th Finance Commission.
The high-powered inter-governmental panel should consist of the Central and State governments to look into the borrowings.
He said that although Telangana was able to access loans that could be up to 4 percent of its GSDP but it had given up 0.5 percent of loans in the interest of farmers following the Centre insists on fixing smart meters on the agricultural pumps.The Union government also resisted the 15th Finance Commission’s recommendation to grant Rs 6,268 million to Telangana under various categories depending on the performance of the state.
He said that Prime Minister Narendra Modi promised to increase the tax portion of states from 32 percent to 42 percent after GST implementation, but by imposing a higher tax the Centre has reduced the tax component for the state.
The Central government was generating approximately 22.26 percent of its revenues through surcharges and cess states are losing revenue and end up with just 29.6 percent of the total revenue generated from the Centre.Telangana has suffered a loss in revenue of Rs.33,712 crores, he said.
He said that the state could have benefited more in the event that the Value Added Tax (VAT) would continue.
He claimed that the Centre has not yet provided Rs 1,350 crore for development of districts that are not developed and also claimed that the BJP for dismantling the federal spirit to realize its slogan of “weaker states and a stronger central”.
.
