Hyderabad: The State Government of Telangana has presented several demands to the 16th Finance Commission to help manage its increasing debt burden.
The government requested the Finance Commission to create policies that allow the state to restructure its loans at lower interest rates. Additionally, they asked for more funds from the Centre, based on the state’s Gross State Domestic Product (GSDP) growth. They also requested the freedom to design their own plans under the Centrally-Sponsored Schemes (CSS), as they believe the current central schemes don’t meet the state’s specific needs. Another key demand was for a share in the cess and surcharge amounts collected by the Centre.
Chief Minister A. Revanth Reddy and Deputy Chief Minister and Finance Minister Bhatti Vikramarka discussed the state’s financial situation in a presentation. They stressed the importance of receiving adequate central assistance to meet the goals set by the Telangana government.
The Chief Minister highlighted that the state is currently paying Rs 5,200 crore every month in debt and interest payments. He asked the Finance Commission to allow Telangana to restructure its loans, which would help reduce the current 11.5% interest rate. They also requested that the share of central funds given to states be increased from 41% to 50%.
The leaders mentioned that Telangana is facing social inequalities, with a majority of the resources controlled by a small group of people.
The state government also asked for central support to improve the education sector. They specifically mentioned programs like the Amma Adarsha School, Young India integrated residential schools, Skill University, and advanced ITIs, which aim to create more employment opportunities. Additionally, they asked for support for infrastructure projects, such as the Musi Riverfront development.
Due to the recent floods that caused significant damage in the state, the Chief Minister requested the Finance Commission to recommend that the Centre provide more assistance to help states recover from natural disasters.
In response, Finance Commission Chairman Arvind Panagariya acknowledged the concerns raised by Telangana and other well-performing states. He noted that it is common for states that have made progress to express concerns over reduced central allocations.
When asked about the state’s demands, Panagariya said that the Commission is open to considering all issues and possibilities. However, he emphasized that no decisions had been made yet and refused to comment on the possibility of increasing the percentage of central funds given to states.
