AP disappointed over finance panel not making any specific award

Even after 42% devolution, AP would have a net revenue deficit of Rs 22,112 cr over the next five years, whereas Telangana would have a surplus of Rs 1.18 lakh cr

The Andhra Pradesh (AP) government has expressed its disappointment over the 14th Finance Commission not making any specific award for the state, though it acknowledged that AP had “suffered fiscal damage as a result of reorganisation”.

The commission treated AP “on a par with other states, both for the purpose of tax devolutions and revenue deficit grant,” according to a detailed note released to the media by the office of the adviser (communications) to the state government.

The release pointed out that though the commission had recommended an award of more than Rs 2.06 lakh crore over a period of next five years (2015-16 to 2019-20) to AP by way of devolutions, revenue deficit grants, grants to local bodies and other organisations, it had addressed only revenue expenditure needs of the state rather than the “massive development requirements of the new state.”

Even after 42 per cent devolution, the state government explained, AP would have a net revenue deficit of Rs 22,112 crore over the next five years, whereas Telangana would have a surplus of Rs 1.18 lakh crore. In fact, AP would be the “only non-special category state that would have a subsisting revenue deficit even in 2019-20.”

However, “though the state government had requested Rs 1,41,467 crore as grants-in-aid to create a level-playing ground and create an ecosystem for catching up with other states, the commission has not awarded any grants-in-aid,” the release stated.

Emphasising that AP is in need of substantial investments for building new capital and creating essential infrastructure, the government expressed that it would be impossible to create a development momentum in the state "without proactive and special central assistance".

In view of this, the state government said, “it is the responsibility of the Government of India to address the development needs of Andhra Pradesh that has been grievously damaged by the reorganisation.”