Andhra Pradesh's rosy budget

DESARAJU SURYA
Hyderabad: With elections to the state Assembly just about two months away, the Y S Rajasekhara Reddy government in Andhra Pradesh sought to project a rosy picture of the state economy through the budget for 2009-10 financial year. But, principal opposition leader Nara Chandrababu Naidu was quick to equate the state budget to the balance sheet of scandal-hit Satyam Computers.
“From gloom to boom” appeared to be the burden of the song in finance minister K Rosaiah’s vote-on-account budget wherein he noted that the state economy was “on a roll” since 2003-04 as per the latest quick estimates and recorded a “phenomenal growth” of 11.27 per cent in gross state domestic product during 2007-08.
This was way ahead of the country’s growth rate of 9.01 per cent during the same period, he pointed out.
“Today, thanks to the various initiatives taken by our government in the last five years, we have emerged as one of the fastest growing state in the country with the economic growth registering 10.64 per cent in 2007-08,” Rosaiah said.
The government’s decision to substantially enhance allocations to irrigation and weaker sections housing programmes paid rich dividends to the state by not only taking the economic growth rate to near 9 per cent per annum but also increasing revenues to GSDP ratio to 20 per cent. Thereby, the government did not require to enhance taxes in any form over the last five years, the finance minister explained.
Quoting the latest RBI report on state finance, Rosaiah said AP stood first in the country in respect of its allocation on plan expenditure, development expenditure, social sector expenditure and capital expenditure. He also said the state’s plan expenditure was the highest for any state in the country in absolute terms with the figure touching Rs 38,477 crore for the ensuing fiscal.
“The economic buoyancy in the state is borne out of the fact that the credit deposit ratio of the banking system has increased from 62.8 per cent in 2003 to 95 per cent by September 2008. Many steps have been initiated in the last five years for substantially enhancing social and economic inclusion in the state which have already started yielding beneficial results,” the finance minister pointed out.