Hyderabad, July 21: The 13th Finance Commission has voiced serious concern over the large quantum of subsidies being doled out by the Andhra Pradesh government.
Commission chairman Vijay Kelkar, who interacted with Chief Minister YS Rajasekhara Reddy, Opposition leaders and officials here on Monday, said subsidies eat into scarce resources needed for development and hence, their prudent management was necessary.
While appreciating the good GSDP ratio and reforms in power sector taken up by the State government, Kelkar also expressed concern over the cost overruns on irrigation projects to the tune of Rs 6,127 cr as on March 2008. There were incomplete multi-purpose projects started way back in 1960s and 70s with a significant irrigation component, he said. Kelkar suggested that the State government study the development model in Gujarat where the government could improve living standards without providing subsidies.
Finance Minister Konijeti Rosaiah, who briefed newsmen, said Rajasekhara Reddy explained to the commission members the reasons for providing subsidies to farmers and other weaker sections. The State would look into the Gujarat model too, he said.
–Agencies–