Telangana Government has gone for another Rs 2,000 Crore Rupees loans in the securities bonds auction at the RBI on Tuesday. The state government has so far taken 15,500 Crore loans this year using this securities auction at the RBI. Meanwhile, the neighboring Andhra Pradesh has taken 17,750 Crore already this fiscal.
It is interesting to note that the rich state is being cautious with its loans even though it has higher eligibility limits. Also the loans it is taking are of longer tenure. Moreover, Telangana’s borrowings are much within the FRBM limits allowed by the Union Government.
Meanwhile, the Jagan Mohan Reddy’s government is almost on the verge of exhausting its yearly limit in a few months. Both the state governments are into extensive welfare schemes. But then, the Telangana government has a cash cow like Hyderabad which will push the economy.
In Andhra Pradesh, there is no such growth engine. Besides the loans, increasing taxes is the only way to improve revenue.