Andhra Pradesh’s Economy

I Satya Sundaram

The Economic Survey, presented by the Andhra Chief Minister, Jagan Mohan Reddy, gave a rosy picture of the Andhra Pradesh’s economy. The reality is different. The Survey said the economy registered 16.22 percent growth in 2022-23. Gross State Domestic Product (GSDP) at current prices for 2022-23 is Rs. 13,17,728 crore, up from Rs. 11,83,891 crore for 2021-22. Welfare Schemes (Navaratnalu) claimed Rs. 1.97 lakh crore.

The so-called welfare schemes are implemented with conditions. Take the case of Ammavodi scheme. It was announced in January 2020. It is providing incentives to mothers for sending children to schools. However, a minimum of 75% attendance is required to claim benefits under the scheme.

The Government brought about some changes in the public distribution system (PDS). It has even thought of giving cash instead of ration items, thus threatening nutrition security. Now ration is supplied through mobile vans at the doorsteps of the beneficiaries. But, items like sugar and red-gram are now costlier. Studies show there are leakages at the mandal level itself. The quality of rice is poor. A part of the ration rice is reaching the open market. Newspaper reports say the Civil Supplies Corporation created fake bank guarantees, and handed over grains to millers.

The mid-day meal scheme is named, Jagananna Gorumudda, with newly introduced nutritious menu (effective from November 21, 2022). However, critics say half of the students are not interested in the new scheme. There is no supervision, no supply of gas cylinders. Some students are bringing their own lunch boxes.

School education has been shattered. In the name of rationalisation, as many as 5,200 schools have been merged with other schools. Even when the basic facilities are not available, the students were asked to join these schools. These students have to walk, in some cases, more than 1 km. There is confusion over the medium of instruction. The Government schools are denied Telugu medium. Because of teacher shortage, the students of both mediums were clubbed, further worsening the confusions.

Under the veneer of decentrali-sation, village volunteer scheme has been introduced. There is confusion over the status of these volunteers. Are they government servants? At present, they are working as party workers. They are even selecting beneficiaries. The High Court reacted harshly. The volunteers are given newspaper allowance, but they have to purchase Sakshi, the newspaper owned by the CM. Some Vice-Chancellors are acting as party agents, and they celebrated even CM’s birth day. The High Court did recognise this and strongly warned.

The panchayats have been enfeebled financially. Their funds have been taken away by the Government, stating that they have been adjusted for electricity arrears. Now, the panchayats have no funds even to take up minor works. The sarpansches of the ruling party are also on the agitation mood.

The Sate is deeply in debt. For repaying loans and interest, it is depending on fresh loans. There are off-budget borrowings. These need not be shown in the budget. Andhra Pradesh tops in debt. For every 1 lakh people, 46,330 people are in debt. The figure is 39,358 for Telangana, 31,510 for Kerala, 31,085 for Tamil Nadu, 24,623 for Karnataka, 14,407 for Odisha and 14,161 for Rajasthan. In the State, there is debt burden of Rs. 2.45 lakh on each farmer. This is three times the national average. Also, the State is not revealing the loans taken with guarantees.

The government spends only 10 percent of its total expenditure on income generating assets. There is no progress in irrigation projects. In the 2021-22 budget, 13.7 percent was shown as capital expenditure, but actual percentage is 8.90. The three-capital slogan has run into rough weather. The Government now says Visakhapatnam is the only capital because the city is well developed. The State has no funds to develop even one capital.

The State Budget for 2023-24 has an outlay of Rs. 2,79,279 crore. But, capital expenditure is only Rs. 31,061 crore. The fiscal deficit is placed at 3.77 percent of gross state development product (GSDP). Welfare has taken the lion’s share of the Budget allocation. YSR pension gets Rs. 21,434.72 crore. Direct Benefit Transfer (DBT) gets Rs. 54, 228.36 crore. Economists ask these questions: If the economy is sound, why the state is deeply in debt? Why is it depending too much on liquor     revenue? Can sustainable development goals be achieved without stepping up capital expenditure? What about pending bills? Why Government is spending crores of rupees on publicity?


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Vol 55, No. 41, April 9 - 15, 2023