Andhra Pradesh Chief Minister N. Chandrababu Naidu sought financial support of Rs 1 lakh crore towards building the capital city and constructing other projects in the state.
A couple of days ago, Naidu met Prime Minister Narendra Modi and other Union Cabinet ministers in the national capital seeking their help in the progress of the state.
It is learnt that Naidu had asked for allocation of a substantial amount of the sought funds from this year’s budget.
Sources said that Modi has also agreed in principle to providing financial support to Naidu’s state.
Modi-led BJP fell short of the majority in the recently held general polls and is relying on Naidu’s TDP and Nitish Kumar’s JDU.
With Naidu being an important ally of the BJP-led NDA at the Centre, it is being said that Modi would certainly help the CM of the southern state.
The financial package sought by Naidu would include raising the fiscal deficit ceiling of 3% og state gross GDP by allowing an additional 0.5% of borrowing for the financial year through March 2025, which is equivalent to about Rs 700o crore.
It also includes Rs 15,000 crore over the next five years to clear overdue debt, Rs 12,000 crore this fiscal year for the Polavaram project, Rs 50,000 crore to build Amaravati and Rs 10,000 crore for infrastructure development under the federal government’s 50-year loan scheme.
It is also known that Naidu had told Modi about the severe financial crisis in the state due to expenses like salaries, pensions and debts.
The state’s public debt was 33% of its GDP at the end of the 2024 fiscal, up from 31% four years ago.
It has to be seen if Modi’s government would release the sought funds in the next budget.
This post was last modified on 7 July 2024 4:08 pm
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