Telangana Chief Minister K Chandrasekhar Rao on Saturday accused the centre of discriminating against the state by imposing "severe cuts" on funds in the Union Budget 2020. Calling the budget "totally disappointing", he expressed apprehension that the centre's Budget allocation may adversely affect the development of Telangana, "which is a progressive state".
"The centre has shown discrimination against Telangana by imposing severe cuts on funds to be released for the state. It is atrocious that state's share has been reduced in the central taxes," he said in a statement released by Chief Minister's office.
KCR, as Mr Rao is popularly known, hinted at a possibility of scarcity of funds for several welfare and development schemes. After a four-hour discussion with senior officials at his camp office at Pragati Bhavan in Hyderabad on Saturday, Mr Rao pointed out that it was the "Constitutional right of every state to have a share in the central taxes".
"In the 2019-20 financial year, an amount worth Rs 19,718 crore was due from the centre to Telangana. The centre had announced in the last budget that this amount would be paid to Telangana. But in the revised estimates, it was reduced to Rs 15,987 crore. With this, in the present financial year, among the funds due from the centre, there is a reduction of Rs 3,731 crore. In anticipation of obtaining Rs 19,718 crore, this also led to the state financial planning going awry as the centre imposed cuts in the release of funds to the state," the statement further read.
"There were occasions when there was a variation of one or half percent. But reducing funds to the tune of a whopping 18.9 per cent in 2019-20 clearly demonstrates centre's faulty fiscal management. This had adversely impacted the Telangana," Mr Rao said, summing up the reduction of funds as "sheer incompetence" of the centre.
He also underlined two ways how the state ended up suffering losses. The first was the centre accepting the proposals of the 15th Finance Commission, reducing the state's share of funds from 42 per cent to 41 per cent. Secondly, Telangana was given 2.437 per cent of share in the past, which was reduced to 2.13 per cent this fiscal, a direct decrease of Rs 2,381 crore of funds from the centre to the state, he said.
"There is no link between what the centre is promising to the states and what it actually releasing as far as the central funds are concerned. Believing in the centre's promises will be highly dangerous often lead to a futile situation," KCR said in the official statement.
The Chief Minister also claimed that the centre is not showing any commitment in implementation of GST, accusing the BJP-led government of "fraud". In the Goods and Services Tax Act, which was brought in 2017, it was clearly stated that for the states - that registered less than 14 per cent of growth rate, deficit caused by the GST would be compensated for five years. As per this, the centre owes a compensation of Rs 1,137 Crore to the state. The Centre has not given any clarity on these compensation funds.
Telangana would be adversely affected on the urban development front also as there is a substantial cut in the Budget, he further said.
The centre has not provided any help to Telangana on major irrigation projects constructed by the state government, ''Mission Bhagiratha'' (supply of safe drinking water to every household) and Mission Kakatiya (revival of old water bodies) schemes, though NITI Aayog had recommended providing Rs 24,000 crore to the latter two programmes, he alleged.
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