Controller Auditor General (CAG) latest report about Andhra Pradesh‘s Financial Condition paints a very grim picture of the state finance. Fifty-Five Paise of Every One Rupee the state government spent this year is mobilized from borrowings.
In the first five months of the year, the state government had pooled in 84,617 Crore. Out of which, 47,130.9 Crore is from loans. The Revenue deficit has gone up to a whopping 38,199 Crore which is very worrying. The State Government has exhausted the loan limit set for an entire year in just five months (precisely 97.59% and is looking at the Center’s relaxation in FRBM limits to go for more loans.
The Government is also spending all the money on Revenue Expenditure i.e., for salaries, pensions, and subsidies while doing meager investments in Capital Expenditure i.e., investing in the infrastructure and long-term assets. During the first five months, the revenue expenditure is 75,669.98 Crore while the capital expenditure is a paltry 8,851.62 Crore.
Next time when you see a badly battered road in Andhra Pradesh, you know why!