Vijayawada, February 9
Due to severe financial crunch , the Andhra Pradesh Government has stopped payment of pending bills indefinitely. Treasury offices in all districts are directed not to make any payments without prior permission.
The State revenue was lowered about Rs 1,000 crores after demonetisation. Also advance payments by a few departments also caused financial crunch in the State.
Due to low revenue generation, the government is unable to pay the bills. Hence, the government issued orders to treasuries in 13 districts to stop payment of bills till they received next orders.
About Rs one lakh crore was already spent from the State budget of about Rs 1.34 lakh crore. Fiscal deficit has reached Rs 24,000 crores while revenue deficit gone up to Rs 15,000 crores.
The State has to get around Rs 16,000 crores from the Centre. Various departments have submitted proposals seeking additional funds to a tune of Rs 26,000 crores.
The ban of high currency notes on November 8, 2016 had a drastic impact on the State exchequer. Even 50 per cent of revenue targets of this year could not be achieved as registrations was almost stalled.
Even the Government has asked the banks not to pay the bills submitted to them.
According to information, the Government is planning to mortgage security bonds with Reserve Bank of India to get out of the financial crisis. The State already requested the Centre to raise FRMB limits to 4 per cent, which will increase the loan limits of the State.
On the other hand, the stalling of treasury payments will have a drastic impact on scholarships, hospitals, payments of mess bills of welfare hostels. The officials observed the situation may continue for another five days.
Normally treasury restrictions on bill payments will be during the month of March. But the present situation in February first week itself shows the grave situation in the State.