The State has received approval from the Central government for mobilising finances to the tune of ₹ 2,508 crore from the open market.
Telangana, along with four others – Andhra Pradesh, Karnakata, Madhya Pradesh and Tamil Nadu, received the benefit for completing the stipulated reforms in the Ease Of Doing Business, considered an important indicator of the investment-friendly business climate in the country. The approval follows completion of first assessment of district-level business reform action plan and elimination of requirement of renewal of registration certificates/approvals/licences by businesses for various activities.
The latest announcement along with recent finances raised through the open market borrowings in the form of State Development Loans are expected to come in handy for the State for crediting amounts into the farmers’ accounts under Rythu Bandhu from December 27 as assured. The new benefit comes as a breather to the State which is landed in a precarious financial situation under the impact of the novel Coronavirus (Covid-19) forcing significant reduction in the budgetary allocations made for the financial year.
While there was significant reduction on the GST revenue front, revenue through the Stamps and Registrations also took a major hit. Revenue through Stamps and Registration at the end of the third quarter was around ₹2,000 crore against the estimated ₹10,000 crore for the financial year. The State was recently given ₹559 crore by the Centre as part of the amount raised through special window and passed on to the States and Union Territories which accepted one of the two options suggested by the Centre with regard to GST implementation. The amount forms part of the ₹ 2,380 crore announced by the Centre through the special window of borrowing and the next instalments are expected to be released in the coming couple of weeks.
This is in addition to the permission to raise borrowings of ₹ 5,017 crore announced under Atmanirbhar Abhiyan after the State had accepted Option-1 of the two options offered by the Centre under the GST implementation. According to the Union Finance Ministry, the Centre had enhanced the borrowing limits of the States by 2% of their GSDP and half of this special dispensation was linked to taking up citizen-centric reforms.
These areas included implementation of one nation one ration card system, ease of doing business reform, urban local body/utility reforms and power sector reforms.
The State was among the first to implement the one nation one ration card initiative along with neighbouring Andhra Pradesh while it had been among the top in the EODB parameters.
The government is however against the implementation of the reforms in the power sector as suggested by the Central government, and the State Assembly passed a resolution opposing these reforms in its last session.
Talking about the resolution in the Assembly, Chief Minister K. Chandrasekhar Rao described the amendments to the Electricity Act as “draconian and dangerous” and totally against the federal spirit of the Constitution.