New Delhi, June 21: Chief minister Y S Rajasekhara Reddy on Saturday urged the Union government to permit the state to mobilise financial resources from the market to tide over the recession impact by relaxing the norms of fiscal regulation and budget management (FRBM) act.
The chief minister made this request during his meetings with Prime Minister Manmohan Singh, finance minister Pranab Mukherjee and planning commission vice chairman Montek Singh Ahluwalia here on Saturday. Sources said he impressed upon all the three that the state had a repaying capacity even if it borrowed beyond the ceiling of 3 per cent of GSDP imposed by the FRBM act.
“The FRBM act imposes ceiling on the state borrowings. A 3 per cent ceiling was fixed based on the repaying capacity of the state governments. Since the Andhra Pradesh’s repaying capacity has improved in the recent past, there is a need to relax the ceiling on the borrowings of the state,” the chief minister told the media after the meetings.
Last year, the Centre had upscaled the ceiling from 3 per cent to 3.5 per cent, YSR said, adding that there was need for further relaxation in the case of Andhra Pradesh. “Internal resource mobilisation of Andhra Pradesh is far higher than in West Bengal. While the internal resources for West Bengal are only Rs 32,000 crore, the same for Andhra Pradesh is Rs 65,000 crore. So, the same ceiling of Rs 11,000 crore loans should not be applied to both the states,” the CM argued.
He, however, said the Prime Minister, finance minister and the vice chairman of planning commission had responded positively. The chief minister also raised the issues of financial assistance to the 104 and 108 services and forwarding the proposal for Rs 650 crore assistance from World Bank for poverty elimination programs in the Andhra Pradesh.
The chief minister also urged the Prime Minister to take an early decision on the categorisation of scheduled castes in the state and according SC status to dalit Christians. YSR told the media that there was widespread sympathy among the Union ministers to help Andhra Pradesh in every way as they were thoroughly impressed by the performance of the party and the government in the state.
—Agencies