Telangana To Defy Limits Set By Union Govt, Sets Sights On Rs 13,000 Crore Open Market Borrowings In Final Quarter Of FY24

Telangana Government has announced its intention to secure Rs 13,000 crore through open market borrowings in the final quarter of the ongoing fiscal year, spanning January to March, as reported by The Hindu.

The proposed breakdown includes Rs 4,000 crore for January, Rs 3,000 crore for February, and Rs 6,000 crore for March.

Despite the Union Finance Ministry's restrictions on borrowing, the state government clarified that there were no specific limitations imposed, and a uniform criterion would be applied to all states for permission under Article 293(3) of the Constitution.

The initially set borrowing limit for the state was Rs 57,813 crore, later adjusted to Rs 42,225 crore after accounting for the over-borrowing of Rs 15,588 crore in previous fiscal years.

Negotiated loans of Rs 1,500 crore and an estimated borrowing of Rs 4,107 crore from the public account left the state with the option of raising Rs 36,617 crore through open market borrowings.

However, by the end of December, the State had already exceeded this limit, borrowing Rs 38,151 crore by October and an additional Rs 4,400 crore in November and December, totaling Rs 42,551 crore.

Concerns have emerged regarding whether the Union Finance Ministry will permit the state to borrow an amount that surpasses the set limit for the current fiscal year.

Despite this, finance department officials defend the State's position, arguing that the budget had initially proposed borrowing Rs 57,813 crore for the current year, and the state should not be deprived of this right due to restrictions imposed by the Centre.