DEBT BURDEN SOARS, BUT IN LIMITS: KCR

Chief Minister K. Chandrasekhar Rao on Wednesday said the debt burden of Telangana State had doubled since its formation in June 2014, but was well within the permissible limits.

Telangana had inherited debt of `72,000 crore from undivided AP in 2014 which has gone up to `1.42 lakh crore.

Interestingly, the CM gave no details about huge loans that were raised by setting up corporations and the state government standing bank guarantee to these corporations to raise loans. He said that there was no cause for worry as the burden was still lower when compared with other states.

“The broad fiscal policy lies with the Centre. States cannot borrow more than the limit prescribed as per FRBM Act. We get loans to an extent for which we are entitled to, leaving no scope for borrowing more. Some Opposition leaders are resorting to propaganda on loans and showcasing their ignorance,” he said.

Chief Minister K. Chandrasekhar Rao on Wednesday said the debt burden of Telangana State had doubled since its formation in June 2014, but was well within the permissible limits.

The government gave bank guarantee to various corporations to raise loans which was a regular administrative practice. “These corporations raise loans in emergency cases. Once the purpose is served, they will repay and close the account. Banks seek government guarantee to extend loans to corporations as per norms. These should not be viewed as government loans,” Mr Rao added.

The Congress promise of a one-time waiver of crop loan up to `2 lakh if elected to power was impossible as it would have to stop all payments, including salaries for eight months, he said.

“The state’s average income per month from all sources, including Centre's tax devolution is around `10,500 crore. We have to spend up to `6,000 crore towards establishment expenditure which include salaries. We need to service the debt for payment of interest and principal amount,” he said and asked why the Congress was trying to ‘cheat’ farmers.