Union Government has come to the rescue of the cash-strapped Andhra Pradesh. Last Tuesday, the state has taken a 1000 Crore loan in the RBI Securities auction. With that, the state has exhausted the entire debt limit allowed for this year in just nine months’ time.
It is impossible that the state government could adjust the remaining of the year only with its incomes. At this juncture, the Union Government has come to the rescue of the Jagan Government. It has granted an additional loan of 10,500 Crore for the first nine months of the year.
The finance ministry has written a letter to the RBI informing the same which will come as a huge relief to the state government. The Government can take loans to this extend from September to December. But the question is if that will be enough for the state.
The question has arisen because the state government is likely to take a 2,000 Crore loan today out of that 10,500 Crore. It looks like Modi has come to the rescue of Jagan at a very crucial hour.
