- Shabbir Ali demands White Paper on Telangana’s loans, utilisation & repayment
Hyderabad, June 20, 2021: Former Minister & ex-Leader of Opposition in Telangana Legislative Council Mohammed Ali Shabbir on Sunday demanded that the State Government come up with the revised budget for the financial year 2021-22 in view of changed circumstances.
“Finance Minister Harish Rao had presented a budget of Rs. 2.31 lakh crore for the year 2021-22 on 18th March 2021. Immediately after its presentation, the Congress party had pointed out that the budget was unrealistic and its figures on revenues were too speculative. Several factors, including the Covid-19 situation, were not taken into account while presenting the budget. The first quarter of the current financial year is about to conclude and the State exchequer is now almost empty. Now the State Government is primarily dependent on borrowings and sale of land to meet the immediate needs like payment of salaries, pension, subsidies and other expenditure,” Shabbir Ali said in a media statement today.
Shabbir Ali said that the total revenues in the month of April 2021 were just Rs. 1,925 Crore or just 4.24% of the estimated Rs. 2.21 Crore for the entire financial year. The collection was even worse in the months of May and June due to lockdown. With the experts predicting a third wave of Covid-19 in the month of October or sooner, the economy is not likely to get back on normal track in near future. Therefore, it will be ideal for Chief Minister K. Chandrashekhar Rao to hold consultations with economists and financial experts and come up with a revised budget on an immediate basis, he said.
The Congress leader urged CM KCR to adopt a realistic approach in dealing with State’s finances. “Financial management of a State is a huge responsibility as it impacts the lives of crores of people. Therefore, it must be dealt with utmost care and precision,” he advised.
Shabbir Ali alleged that the Telangana State was now in a huge debt trap with borrowings of nearly Rs. 5 lakh crore, which includes the loans taken by various corporations. He said that the State Government took huge loans from various agencies on high-interest rates without giving a single thought about their implications. He pointed out that the Telangana Government was spending about Rs. 17,584 crore only on payment of interest for the loans which it secured since 2014-15. This amount is almost equal to the combined expenditure on Pensions and Subsidies (Rs. 10,831 Cr + Rs. 8,721 Cr). The State Government can overcome a situation by borrowing a huge loan from some agency. But this will push present and future generations of people of Telangana in huge debts for several decades and the hard-earned money of tax-payers will be wasted for non-productive purposes, he said.
The Congress leader said that the State Government took loans of Rs. 45,638 Crore as against the budgeted borrowings of Rs. 33,191 crore in the year 2020-21 after the Centre increased the FRBM limit to 5%. This year too, the State Government had proposed to borrow Rs. 45,509 Crore in the budget. But now it wants to borrow additional loans of Rs. 12,000 Crore by asking the Centre to increase the FRBM limit. It wants to raise another Rs. 20,000 Crore by the sale of government lands.
Shabbir Ali said that the Chief Minister should release a White Paper on Telangana’s financial condition by giving clarity on both present and proposed loans. He said CM KCR should also give a complete break-up of how the borrowed loans were utilised. The State Government must explain how it plans to repay the loans and their interest. “The State Cabinet has announced several decisions including the PRC, setting up of hospitals and other issues. Therefore, CM KCR should present a true picture of the State’s finances through a White Paper before presenting a revised budget in the Assembly,” he demanded.