Hyderabad: In a big setback to AP, the Centre has refused to release the balance of funds of about Rs 790 crore under the state share in tax devolutions for November.
The Centre said that this amount would be used to recover funds given in excess over the past six months. The Centre told the AP government that the tax revenue was not collected according to budget projections in the first six months of the current fiscal.
The half-yearly review on tax revenue by the Central government revealed that AP was given about Rs 790 crore in excess over the last six months and to recover that amount, it will release Rs 970 crore as against Rs 1,760 crore as state share in tax devolutions in November. AP officials said it was not clear how much funds will be released by the Centre from next month under the state share in tax devolutions.
AP to borrow Rs 1,500 crore
In the present financial crisis, the AP government has decided to borrow Rs 1,500 crore next Tuesday. Currently, it is unable to release funds to the departments to take up development works.
A senior official said if the same situation continued in the coming days, the state government would have a tough time to pay salaries to its employees.
