Narendra Modi's government has given the biggest possible shock to Andhra Pradesh which is heading towards a massive financial crisis. The finances of the state has fallen and there is no way that it can give salaries to the 5.67 Lakh employees in February. Chandrababu's government is lobbying hard in Delhi for an urgent help from the Center.
However it is reliably learned that Central government has clarified to Andhra Pradesh that it can not help the state in a big way as the Union Budget is already running with One Lakh Crore deficit. There is a hint that center may allot 2000-3000 Crore for Andhra Pradesh's deficit budget when there is a 15600 Crore deficit. According to the state officials, the revenue deficit will reach 20000 Crore by end of this financial year.
According to the Andhra Pradesh Reorganization Act, Center has to bear the deficit budget of the truncated state for the first year. But now Narendra Modi's government is turning back on the promise. On the other side, AP is all set to auction its securities next week for pooling in 1000 Crore funds. This auction will be conducted in Mumbai by RBI.
