The Andhra Pradesh government is continuing with its borrowings spree. The state government has written to the Centre seeking permission to borrow Rs 2,000 crore from the market this month.
As per central norms, AP can borrow about Rs 5,000 crore more before the end of the current financial year in March 2016. The previous month, the state government borrowed Rs 500 crore. In the last 9 months, the state government borrowed altogether about Rs 11,000 crore. The state wants the Centre to allow it more borrowings by exempting it from the Fiscal Responsibility and Budget Management (FRBM) act. As per this Act, the Centre had fixed about Rs 17,000 crore by way of total borrowings in the current financial year for the state government. This will include market borrowings.
In the month of November, the state government had asked the Centre to allow it borrow Rs 4,000 crore. But the Centre gave its nod for only Rs 2,000 crore. After borrowing this much, the state government will have the freedom to borrow Rs 3,000 crore in the next two months.