The State government has rejected the Central government’s offer to allow enhanced borrowings under the Fiscal Responsibility and Budget Management norms as it is linked to reforms in the power sector.
Minister for Finance T. Harish Rao said the State would be deprived of ₹25,000 crore over the next five years at the rate of ₹5,000 crore a year if it did not accept the Centre’s offer. For the sake of these ₹25,000 crore, the State should implement a series of reforms in the power sector which were particularly against the interests of the farmers. “The autocratic attitude of the Centre can be understood by this,” he said presenting the budget for 2022-23 in the Legislative Assembly on Monday.
He asserted that the State government was not interested in making the farmers pay for the power, which was being provided to them. That was not the policy of Telangana and Chief Minister K. Chandrasekhar Rao told the Centre that such a policy would not be implemented “as long as he (Mr. Chandrasekhar Rao) is alive”.
The Government was willing to forego ₹25,000 crore for the sake of four crore people of the State. This was due to the fact that “this government is for the welfare of the farmers and the leader himself is a son of a farmer”. The Minister lamented that no justice was done to Telangana even in the latest Union Budget. No irrigation project was given national status, no money was given to any programme. “It was only a sweet talk without the offer of any concrete help. Even borrowing is now conditional,” he said.
Mr. Harish Rao was particularly critical of the Centre for its efforts to constantly reduce the size of the divisible pool by imposition of cesses as these were not part of the divisible pool. The States were supposed to receive 41 % of the divisible pool, but they were receiving only 29.6 % leading to a shortfall of 11.4 %. The same was pointed out by the XV Finance Commission too, but the Centre had brushed aside those comments and had not taken any corrective action.
