Telangana Nearing Bankruptcy, Unable to Repay New Loans:
The Union Power Minister, Raj Kumar Singh, stated during a press conference that the Central Government believes the Telangana state government is on the brink of bankruptcy and may struggle to repay new loans. He mentioned that the loan approval for the Yadadri Thermal Power Station project was withheld because of Telangana’s dire financial situation, preventing it from meeting its loan repayment obligations.
Regarding financial regulations like the Fiscal Responsibility and Budget Management (FRBM) rules, Singh clarified that these matters fall under the jurisdiction of the Union Finance Ministry. Loans cannot be granted if a state exceeds its FRBM limits or if there are concerns about its ability to repay the loans.
Singh also highlighted that over the past decade, significant loan approvals were granted to Telangana by organizations like the Power Finance Corporation (PFC) and Rural Electrification Corporation (REC). However, not all approved amounts were disbursed, indicating caution due to the state’s financial challenges.
Furthermore, Singh refuted claims by the Telangana state government regarding meter installations for agricultural connections, asserting that the government’s statement was inaccurate. He clarified that the central government’s directive pertained to meters for non-agricultural connections and not agricultural ones, emphasizing that the government’s attempt to shift focus was due to its inability to provide the promised 24-hour power supply to the agricultural sector.