Hyderabad: Chief Minister A. Revanth Reddy made a strong demand before the 16th Finance Commission for an increase in the state’s share of Central taxes from the current 41 per cent to 50 per cent, and sought support to manage the state’s legacy debt.
At a meeting with the Finance Commission at Praja Bhavan here on Tuesday, Revanth Reddy said, "I speak for all states on this. Increase allocation of Central funds to states from 41 per cent to 50 per cent," which, he said, would enable states to contribute more robustly to India’s overall growth.
Revanth Reddy argued that this enhanced share would provide the necessary fiscal space to address the challenges that Telangana and other states face.
He pointed out Telangana’s huge debt burden, accumulated over the past 10 years, now exceeded Rs 6.85 lakh crore, and called for support in managing the state’s loans and interest payments.
The Chief Minister highlighted that a significant portion of the state’s revenue was being used solely to repay debt accumulated over the past decade. "If we don’t manage our loans and interest payments, it will slow down our progress," he said.
Revanth Reddy requested the commission to offer options to either restructure the state’s debt or provide additional financial assistance to help free up resources for development.
He stressed that the high level of debt has created a scenario where a considerable portion of Telangana’s revenues was diverted toward debt servicing. "Large loans borrowed in the last 10 years have now created a situation where a significant part of our revenues is used just to repay debt," he stated, urging the Commission for relief.
The Chief Minister also reiterated his commitment to Prime Minister Narendra Modi’s vision of making India a $5 trillion economy. He pledged that with the support of the Finance Commission, Telangana could become a $1 trillion economy and play a vital role in helping India become the third-largest economy globally. "I promise you, if you can do this, I will take on the huge responsibility of making Telangana a $1 trillion economy," Reddy declared.
Revanth Reddy expressed confidence in the Finance Commission’s ability to strengthen fiscal federalism, which would help Telangana overcome its current challenges and continue on its path of growth. He welcomed the Commission to Telangana, referring to it as "The Future State" and expressing hope that the Commission’s recommendations would benefit both the state and the country.
