The Andhra Pradesh government spent only 24% of the borrowings of the current year (₹87,773 crore) on capital expenditure (₹21,173 crore).
The Comptroller and Auditor General report, which was tabled in the Assembly, on Friday said the state government maintained the minimum cash balance with the Reserve Bank of India for only eight days without availing any WMA from RBI.
The report further stated that the government’s revenue deficit exceeded the Fiscal Responsibility and Budget Management (FRBM) target of 2.7 per cent of GSDP, remaining at 3.75 per cent even in 2024-25. This forced the state to borrow for day-to-day expenses and significantly increased its interest burden.
The fiscal deficit remained at 5.05 per cent against the mandated 4 per cent ceiling, driving total borrowings to ₹81,071 crore, crowding out capital expenditure, worsening debt sustainability and severely restricting fiscal space for future growth.
“During 2024-25, the Government of Andhra Pradesh availed ₹42,004 crore Special Drawing Facility for 71 days and paid ₹188.82 crore as interest, ₹73,897 crore Ways and Means Advances for 179 days and paid ₹82.30 crore as interest and ₹56,631 crore Overdraft for 107 days and paid ₹32 crore as interest,” it said.
When contacted, TDP spokesperson Neelayapalem Vijay Kumar said when the NDA government took over administration in Andhra Pradesh on June 10, 2024, the previous YSRCP regime had already borrowed ₹38,000 crore.
“During the remaining year, the NDA government in the state borrowed ₹42,000 crore, leading to a high debt,” the TDP leader told PTI.
He further said that the dependence on RBI loans was due to legacy issues left by the previous government, such as unpaid bills to contractors and employees, among others.
“The minimum cash balance was maintained by the Government of Andhra Pradesh with the RBI for only eight (08) days without availing any WMA from RBI,” the CAG said.
Though it is essential that borrowed funds are fully utilised to finance productive capital assets, while revenue receipts should be reserved for servicing debt interest and principal repayments, the state government spent only 24 per cent of the borrowings of the current year (₹87,773 crore) on capital expenditure (₹21,173 crore).
The state government had not disclosed the quantum or source of proposed off-budget borrowings (OBBs) in its Budget of 2024-25 and informed the Ministry of Finance that no off-budget liabilities were availed during 2024-25.
However, there was an outstanding amount of ₹27,241.99 crore by the end of 31 March 2025, the CAG said.
Published on March 7, 2026