AP to raise Rs 3k cr from market

The state government, facing difficulties in meeting its financial obligations, has imposed fresh restrictions on the funds released from the district treasuries and asked the government departments to earnestly follow financial discipline norms.

It has also decided to go to the open market to raise funds by issuing government secured bonds.

In fact, the state has already raised Rs 2,000 crore last month through bonds.

The finance department is now planning to raise another Rs 3,000 crore next month to overcome the present precarious condition.

“At present the gap between actual income and expenditure has crossed Rs 3,000 crore every month,” said an official. “While the financial commitments are pegged at Rs 7,200 crore, the actual income per month is hovering around Rs 4,000 crore.”

The government has also asked departments not to release funds to unproductive and non-budgeted works.

Not a single rupee has been issued to irrigation contractors who have stopped works at different project sites.

The dues of irrigation works have crossed Rs 4,000 crore as the finance department has not given green signal for the release of funds.

“We have to spend about Rs 28,000 crore by the end of first quarter,” said the official. “But the total release till date has not even crossed Rs 5,000 crore.”

With no funds likely to come from the Centre till July, the state government has to dip into its own resources which are scant.

With all key departments showing dropping revenues in the present financial year also, the state government is in a dilemma whether to go ahead and spend the money allotted in the budget or to go slow by releasing nominal amounts.

The revenue from commercial taxes, registration, excise, mines and land have registered nominal increase in April but could not reach the targets set for the quarter. Plans to raise Rs 3,500 crore through sale of government land in several districts have also come a cropper because of the subdued real estate market.