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Follow bifurcation formula in cash release too: AP CM
The Andhra Pradesh government wants the Centre to follow the bifurcation formula of 58:42 ratio in the release of new currency notes between the two Telugu states post demonetisation.
Hyderabad: The Andhra Pradesh government wants the Centre to follow the bifurcation formula of 58:42 ratio in the release of new currency notes between the two Telugu states post demonetisation.
This ratio is used for sharing of assets as per the AP State Reorganisation Act following bifurcation of Andhra Pradesh.
According to highly-placed sources in the Finance department here, this fact had come to light during their interaction with officials of the Central government during their recent visit to New Delhi.
The sources said that they had gone to Delhi to pursue with the Centre for the release of money from the RBI after the demonetisation of high-value currency notes.
Sources said that they were told by the officials in Delhi that Naidu had strongly argued with the Union Finance Ministry that being the residuary state, Andhra Pradesh was in deep financial crisis and it started with a deficit budget of about Rs 19,000 crore.
The Centre had also not given special category status to AP. Though it had announced special package, so far the Centre had not given legal sanction to it nor did it release any funds to the state as per the promised package.
In the backdrop of this situation, the demonetisation had showered yet another blow on the state’s economy.
Surprisingly, the RBI released Rs 16,000 crore to both the states out of which Rs 9,000 crore was allotted to Telangana and Rs 7,000 crore to Andhra Pradesh.
AP being the residuary state, more cash should have been released to AP as compared to Telangana, Naidu is learnt to have argued.
The sources said that Naidu also spoke to the RBI top officials and enquired on what basis the Reserve Bank was releasing currency notes to tide over the crisis in each state.
After a detailed discussion, the state Finance department forwarded a requisition to Union Finance Ministry seeking release of more currency.
However, the Centre has ruled out the possibility of following the 58:42 ratio in allocating cash to AP.
The RBI would allocate money to each state based on the economy and requirement of each state, the officials of the Union Finance Ministry told the officers from Telangana.
