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Telangana high cost debt piling up
A little over twenty-one months on coming to power with a surplus budget of Rs 16,000 crore in 2014, the Telangana State government has incurred high-cost debt.
Hyderabad: A little over twenty-one months on coming to power with a surplus budget of Rs 16,000 crore in 2014, the Telangana State government has incurred high-cost debt.
Reply to an application filed by this RTI Correspondent of The Hans India has revealed that the government has so far borrowed approximately Rs 33,033 crore between September 10, 2014 and June 2016.
Although the government gave details on the type of borrowings, repayment schedule and the total interest paid, it failed to provide information pertaining to agreements on the grounds that the loan agreements were not available and advised the applicant to contact the administrative department concerned.
Normally, when certain information is not available, the information officer is expected to transfer the application to the department concerned within five days on receipt of it. This lacuna stands glaringly exposed in this particular instance.
However, according to the information provided by RTI, the government during the financial year 2014-15 borrowed Rs 9,579.35 crore and in 2015-16 the borrowings were Rs 16,888.86 crore. In the present financial year too it has raised loans to the tune of Rs 6,564.85 crore till June 30.
What is interesting is that the loans raised have been released for the entire expenditure in the state in the respective financial years irrespective of departments or schemes. This is in complete contrast to the established procedures.
A look at the borrowings and the interest rates indicates that Rs 1,423.31 crore have been taken under external aided projects at rates ranging between 5 percent and 6.7 percent interest, Rs 1,600.66 crore from Nabard at an interest of 7.5 percent and Rs 28,048.2 crore from the open market at a staggering 7.39 percent to 8.62 percent.
Similarly, it had availed of Rs 1,845.18 crore loans from the small savings fund at 9.5 percent; Rs 1,125.16 crore from Hudco at 10.45 percent and Rs 114.91 crore from NCDC at 11.85 percent to 12.10 per cent.
The loan amounts varied between Rs 5 lakh and Rs 2,000 crore. Telangana State had an outstanding loan from open markets of Rs 48,786 crore at the time of bifurcation of the state.
Between 2014 and 2016, the government had repaid Rs 1,965 crore. The interest component during the same period was Rs 9,626 crore. The total debt now stands at Rs 69,651 crore while the interest paid in 21 months is Rs 4,400 crore.
