PAC Chairman Payyavula Keshav flays government over Rs 17,923 crore excess loans

Amaravati: Assembly Public Accounts Committee (PAC) chairman Payyavula Keshav on Saturday demanded the YSRCP government to explain whether or not the Union finance ministry had taken strong exception to loans of Rs 17,923 crore taken by the state government in excess of the ceiling imposed on it.

Keshav, a TDP MLA, also asked whether it was not a true that the Union finance ministry wrote a letter dated June 30 expressing its objections to the state government. In the letter, the assistant director of finance ministry, gave reasons why they were not conceding the AP's plea for raising the open market borrowings of over Rs 17,810 crore this year, he said.

In a statement here, the PAC chairman asserted that the objections of the Centre were enough to understand how the AP finances and economy were crumbling under the Jagan Mohan Reddy's misrule.

More and more objections were coming from the Union finance ministry to the AP government's efforts to make excess loans. It was high time that the Chief Minister, finance minister and the AP finance department explain to the public on the Centre's letters, he remarked.

Keshav demanded the YSRCP government to give its response to the Centre which sought clarification on the AP's loans and their purpose. It was alarming that the AP finances were slipping into a total mess.

The Jagan Reddy regime was not giving correct and factual information to the Assembly, the Opposition and others in the state. At least, the ruling party in AP should explain the factual position to the Centre, he said.

Keshav said that the Union finance ministry gave its response to a letter received from finance department, Government of Andhra Pradesh, requesting to issue the GoI consent for raising open market borrowing of Rs 17,810 crore for the first nine months of 2021-`22.

The Centre clarified that an amount of Rs 17,923.94 crore was adjusted with the available borrowing space of AP on account of over-borrowing by the state during the earlier years.

The PAC chairman further said that the Centre's letter clarified that Rs 37,163 crore was considered for borrowing limit of AP for the first nine months of 2021-`22. This was as per the Central guideline to allow only 3.5 per cent of Gross State Domestic Product (GSDP).

The borrowing space of the state for any given year is calculated on the basis of information submitted by the state. Keshav referred to the contents of the Centre's letter which said the borrowing limits were imposed only after considering the CAG-audited state finance accounts.

The adjustment on account of over-borrowing by the state arises due to 'deviation' in the information given by the state. Accordingly, in the instant case of AP plea, repayments and other borrowings were considered based on the information provided by Andhra Pradesh only as per its letter dated April 22.