Minister of State at the Ministry of Finance Bhagwat Karad was responding to a question posed by MP Kanakamedala Ravindra Kumar of the Telugu Desam Party (TDP) on August 10.
Since coming to power in April 2019, the YSRCP-led government of Andhra Pradesh has benefited from Rs 56,076 crore in loans from various public sector banks, the Union government said. at the Rajya Sabha on Tuesday August 10. Andhra Pradesh used its biggest loan. of Rs 15,047 crore from the State Bank of India.
Minister of State at the Ministry of Finance, Bhagwat Karad, was responding to a question put to the Ministry of Finance (MoF) by MP Kanakamedala Ravindra Kumar of the Telugu Desam Party (TDP). The MP had asked for details of the loans granted by the government of Andhra Pradesh to banks since 2019. In response, the Ministry of Finance clarified that new loans to state governments are issued by the Reserve Bank of India (and not by banks) as RBI. government banker. The Ministry of Finance stated that this was in accordance with the provisions of clause (b) of subsection (1) of section 21A of the Reserve Bank of India Act, 1934.
In June of this year, the government of Andhra Pradesh had problems with the Ministry of Finance, due to financial irregularities while resorting to bank loans. The state had informed the Ministry of Finance months before that it had obtained loans worth Rs 18,500 crore. These loans were taken from banks through the Andhra Pradesh State Development Corporation (APSDC). The YSRCP government contracted these loans by pledging its future tax revenues for the 2020-21 fiscal year.
The finance ministry stressed at the time that pledging state assets to banks was prima facie unconstitutional and sought comments on the alleged financial violations. The matter was first reported by retired former Chief Secretary of Andhra Pradesh IYR Krishna Rao. YSRCP rebel MP Raghu Rama Krishna Raju Kanumuru also wrote to the Ministry of Finance and Prime Minister Narendra Modi, alleging financial irregularities on the part of the government of Andhra Pradesh. The state already has a debt burden of Rs.373,140 crore as of November 2020.
Apart from the State Bank of India, Andhra Pradesh has received loans from the Bank of Baroda worth Rs 9,450 crore, Rs 7,075 crore from the Bank of India, Rs 6,800 crore from the Union Bank of India, Rs 5,797 crore from Punjab National Bank and Rs 4,300 crore from Bank of India. As well as loans worth Rs 2,800 crore from the Bank of Maharashtra, Rs 2,307 crore from the Central Bank, Rs 1,750 from the Indian Overseas Bank and Rs 750 crore from the Punjab and Sind Bank.