AP seeks permission to raise Rs 18,000 crores to bridge deficit

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New Delhi, Nov 26 (UNI) Andhra Pradesh today sought the Centre's permission to raise funds worth Rs 18,000 crores from the market to maintain current level of spending in various ongoing social welfare and development projects, exempting the state from the provisions of Fiscal Responsibility and Budget Management Act.

A plea to this effect was made by Andhra Pradesh Chief Minister Y S Rajasekhara Reddy during his meetings with Prime Minister Manmohan Singh, Finance Minister P Chidambaram and Planning Commission Deputy Chairman Montek Singh Ahluwalia. The state had apprised the three key figures handling the national economy about the effects of the global slowdown on the revenues of the state.

Dr Reddy told reporters later that the effects of the slowdown at the global level was being felt in the revenue collections both at the national and state level. The state had seen a GSDP of 10.63 per cent for the last four years and if the Government does not continue its expenditure on social welfare measures and infrastructure projects including irrigation, it would have adverse effect on the economy. He reminded that the Prime Minister had argued for stepped up spending on infrastructure projects in the recently concluded G-20 meeting and neighbouring China too had planned spending 586 billion dollars on infrastructure during the next two years.

He said the effect of slowdown on AP's economy was that the state would face a shortfall of Rs 11,000 crore considering that the FRBM Act allowed the state to raise Rs 7,000 crores to fund resources. ''We have sought the government's permission to consider our request to allow the state to raise an additional resources worth Rs 11,000 crores in addition to Rs 7,000 crore allowed under the FRBM Act,''he said.

Asked from where the state would raise resources the Chief Minister said the economy of the state enjoyed a very high credit rating and would find no problems in mopping up resources in the form of bonds, bank loans and other instruments to service the funding of the project.

''The Central leaders have viewed our proposal in the right spirit and we expect their answer in the next few weeks.'' Answering questions on Telangana, Dr Reddy said the Congress had promised Second States Reorganisation Commission to consider the Telangana demand but could not do it in the absence of consensus among the coalition partners. The issue is before the Congress party and it will take an appropriate decision weighing all pros and cons.

He contended that Congress is the only party which was consistent on Telangana while all other parties including Telugu Desam Party had vaccilated in opposite directions. Even Left parties which profess idealism had joined hands with TDP sidestepping their own opposition to creation of Telangana out of Andhra Pradesh, he remarked.


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