The Union Government will facilitate special financial support through multilateral development agencies to the tune of ₹15,000 crore, Union Finance Minister Nirmala Sitharaman said.
“Our government has made concerted efforts to fulfil the commitments in the Andhra Pradesh Reorganisation Act. Recognising the State’s need for a capital, we will facilitate special financial support through multilateral development agencies. In the current financial year, ₹15,000 crore will be arranged, with additional amounts in future years,’‘ she said in her Budget 2024-25 speech on Tuesday.
“Our government is fully committed to financing and early completion of the Polavaram Irrigation Project, which is the lifeline for Andhra Pradesh and its farmers. This will facilitate our country’s food security as well,’‘ she said.
Funds will also be provided for essential infrastructure such as water, power, railways and roads in Kopparthi node on the Visakhapatnam-Chennai Industrial Corridor and Orvakal node on Hyderabad-Bengaluru Industrial Corridor. An additional allocation will be provided this year towards capital investment for economic growth, Sitharaman said. Grants for backward regions of Rayalaseema, Prakasam and North Coastal Andhra, as stated in the Act, will also be provided.
Crucial support
The NDA’s pre-poll manifesto in the State promised building new capital at Amaravati, completion of the long-pending Polavaram Irrigation project and host of freebies under its ‘Super Six’ welfare schemes. Centre’s financial support, thus, becomes crucial for the State Government to fulfil these promises.
The State Government, in a first of its kind move, also deferred the full Budget for the sake of clarity on the State finances. It will be releasing a white paper on the finances in the ongoing Assembly sessions.
- Also read: Budget 2024: Nirmala extends support to Andhra Pradesh, but Naidu’s challenge far from over
As per government data, the capital expenditure was reduced by 60 per cent in 2019-24 compared with 2014-19. Departments such as Water Resources and Transport, Roads & Buildings which undertake substantial capital works were left ‘critically short of funds’ to carry out any works, it said.
The compound annual growth rate of State’s Own Tax Revenue slipped from 12.8 per cent to 8.1 per cent during this period. On the other hand, the revenue expenditure increased from 7.8 per cent to 10.5 per cent.
Jayadev Galla, Chairman, Amara Raja Group, “Union Budget allocations for Andhra Pradesh is a step in the right direction. ₹15,000 crore support for capital development, commitment to financing and completion of Polavaram irrigation project, grants for backward districts and allocation of funds for various social and Infra development projects will significantly attract new investments and spur growth. We eagerly await to see the actual allocations for other projects and fulfillment of commitments made in the AP Reorganisation Act. We look forward to continued support from the Centre as we work to rebuild the State.”