TS, AP overstate aid to be given by Centre

Hyderabad: The governments of the two Telugu states, in particular Telangana, have to blame none except themselves for the so-called meagre release of financial assistance from the Centre in the form of grants-in-aid.

An analysis of the budgets of the two states in the last few years reveals that the governments went overboard in making provisions for the grant-in-aid from the Centre, apparently to keep the overall outlay at fancy figures of two lakh-crore plus rupees. But, the governments, as a senior finance official put it, knew well that they were asking for moon and would never go anywhere close to the projected figures.

The windfall benefit, however, for the Telangana Rashtra Samiti (TRS) government is that it could build a narrative that the Modi-led Centre had been discriminating against Telangana in releasing grants. Incidentally, the Centre released more aid than what Telangana asked for in previous financial years but cut it down drastically in 2021-22.

The Telangana government made a budgetary provision of Rs 8,177 crore in 2019-20 and got Rs 11,598 crore (141 per cent) and Rs 15,471 crore against Rs 10,525 crore (146 per cent) in 2020-21. Andhra Pradesh, on the other hand, managed to achieve 35 per cent and 59 per cent respectively for the corresponding period.

In 2021-22, however, the Telangana government jacked up the budgetary provision almost four times to Rs 38,669 crore of which it got only Rs 8,629 crore. Yet, the government enhanced the provision to Rs 41,001 crore in the current budget though it was aware, more or less, how much the Centre would release as the Union Budget had been presented by then.

Defending the move, Telangana special chief secretary, finance, K. Ramakrishna Rao told Deccan Chronicle that Niti Aayog itself had recommended Rs 25,000 crore grant (Rs 19,000 crore for Mission Bhagiratha and the remaining for Mission Kakatiya). “We cannot give up on the assistance, as recommended by the Niti Aayog, by not making a budgetary provision,” he said.

The Niti Aayog recommendations, however, are not binding on the Centre unlike those of the Finance Commission. The Centre also maintains that either the devolution of Central taxes or the grants-in-aid to states will always be organic and will not change to suit the states’ needs.

The Andhra Pradesh government too has been asking for more than Rs 50,000 crore of grant-in-aid every year since 2018-2019 but never got more than Rs 30,000 crore. Thanks to the Reorganisation Act and political diplomacy, the Jagan Mohan Reddy government got about 60 per cent of the budgeted grant-in-aid in the last two financial years.