YS Jagan Mohan Reddy faces uphill task of funding Naidu’s projects

Vijayawada: Sizeable challenges in the form of construction in the capital city of Amaravati, the Polavaram multi-purpose project, and implementation of the Navaratnas await Mr Y.S. Jagan Mohan Reddy, who will take oath as Andhra Pradesh’s second Chief Minister on May 30.

The TD government had estimated the cost of constructing buildings and providing facilities at Amaravati at Rs 42,000. Detailed project reports in this regard have been submitted to the Centre.

Although there was a loud debate between the central and state governments on the submission of the DPRs, the Centre has so far released only Rs 1,500 crore.

Having received only a small chunk of the funds, the TD government could only manage to lay foundations for a few buildings.

In order to complete the Polavaram project, the state needs another Rs 60,000 crore. Since the project has been declared a national project, funding shouldn’t be a problem. However, the release of funds has been rather slow so far, and the execution of the project is another cause for concern.

Additionally, the Naidu government took full responsibility of constructing the project even after it was declared a national project. The YSRC often pointed out that the state government had taken the responsibility for kickbacks.

It will be interesting to learn whether Mr Reddy's government continues to pursue the TD's policy of constructing Polvaram or if it hands the responsibility back to the Centre. For Amaravati, however, Mr Reddy will need support from the Centre.

Further, to fulfil the Navaratnas, or nine promises, Mr Reddy will need at least Rs 50,000 crores per annum. At a time when the state coffers are empty, Mr Reddy has no choice but to maintain friendly relations with the Modi-led Centre.

Former AP finance minister Yanamala Rama-krishnudu often said that the state was dependent on borrowing for day to day activities as well.

“No doubt these are challenges. We are aware of the financial position of the state but we’ll hopefully work out a formula to face the challenges,” said a newly elected MLA who may be part of the state cabinet.