What is happening in Andhra Pradesh?

One of the features of Andhra Pradesh (reconstituted state) assembly is that two parties account for nearly 98-99% of the total members in the house with no representation for the party which governed previously. This has happened due to various reasons main being the division of the State into the rump state and the state of Telangana. Telugu Desam which was a main opposition in the undivided state for 10 years came into power with various promises to the people. 

Some of the main promises being the loan waiver for farmers & women self help groups, promise of a job for each household, banning of illegal shops selling liquor (known in local parlance as belt shops) and last but not the promise of good governance based on their experience in government (their leader Mr Naidu was a Chief Minister of the undivided state for 9 years and main opposition leader for another 10 years). 

Even though the government is constituted and swore in almost two and a half months back under Mr Naidu little progress can be observed on many of these promises. Firstly, on the loan waiver issue, the policy of the government appears to be one step forward and two back. Immediately after swearing in as promised Mr Naidu constituted a committee to identify the total loans and the modalities. Then the chief minister and his ministers started giving statements to the media that the promise appears to be difficult as they were unaware of the actual financial situation and the coffers are empty. Naturally the question raised by every one including the opposition is that when the promise was given how a person with such a long experience did not check the actual situation. Then it was hinted in media that they will be issuing state government bonds to finance the waiver scheme with a request to notify them for SLR (statutory Liquidty Ratio) investments so that Banks subscribe to the same. Reserve Bank of India negated the proposal. Next came the proposal of rescheduling the crop loans eligible for waiver (which are short term in nature) for a period of 7 years. 

That is to postpone and extend the liability of the newly formed government for a period of 7 years which is beyond the elected term of this government. Again Reserve Bank of India negated the proposal for a wholesale waiver due to a. this will increase the loan defaults in future and b. rescheduling is given during the wholesale crop loss due to floods, scanty rains etc. According to them no such situations were notified by the government machinery in any of the district in the previous years, As a matter of fact, they modified their stances for some districts.

Then came the hare-brained idea of auctioning the seized Red Sanders logs (red sanders has a huge international demand and grows only in 1-2 districts. Government has banned felling of the trees long-time back). The government expects around INR 60-70 Billion from this activity which is very less compared to the estimated requirement for loan waiver of around INR 300 - 500 Billion. The latest is that , as recent as 3 days back the Chief Minister is still reiterating that whatever happens and whatever hardships are faced the government will go ahead and complete the loan waiver. Still there is no clarity and let us hope that we hear something positive over this issues in come months.
 
In the next part will look at the State Capital issue.

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