As the borrowing gap of Rs 30,000 crore will be difficult to bridge, budget estimates will be drastically changed, sources said. CM’s admission on limited borrowing is indication enough that the Centre’s grants will not exceed Rs 10,000 crore this year. The resulting loss would be around Rs 30,000 crore, bringing the total shortfall to Rs 60,000 crore, sources said.
Previously, it was estimated that borrowing up to Rs 19,000 crore would be reduced. Going by the CM’s claims, the loss appears to be much larger as the state will have to generate its own sources of revenue to meet budget forecasts.
Ironically, on the day the CM spoke about the Centre’s arbitrary reduction of Telangana borrowing limits, Prime Minister Narendra Modi told a town hall meeting in Uttar Pradesh that young people should not fall into gifts from governments.
Meanwhile, the former finance minister and BJP MP from Huzurabad Eatala Rajender said FRBM rules cannot be applied differently in different states. “The rules are the same. Telangana is now heavily indebted. If fiscal prudence is not maintained, there will be serious consequences for the state,” he warned.
Previously, Telangana paid Rs 54,000 crore per annum in interest and principal on loans taken out. “This has now risen to over Rs 60,000 crore due to increased loan burden,” Eatala pointed out.