Telangana-stung CM, KKR unleashes austerity drive

News pulse, Picture gallery, Politics | admin | November 7, 2011 at 5:15 am

With an estimated Rs 10,000-crore hit to the State’s economy due to the 42-day-long Telangana agitation, a clueless Kiran Reddy Government is now scrambling to find a way out to put Andhra Pradesh back on track.

But, even as it has unveiled a series of austerity measures, including review of number of contractual employees, and barred purchase of new machinery, air travel by business class by Ministers and officials, and conferences in five star hotels, it has also launched the controversial Rs 1 per kg rice scheme for BPL families. This populist measure is set to deal a further Rs 2,600 crore blow annually to the State exchequer at a time when the State’s finances are in a mess.

During the strike that ended last week, Rs 600 crore was lost due to shutdown at Singareni Collieries, power shortage and resultant water crisis led to a loss of one crore eggs per day and death of 25 lakh birds, the State Road Transport Corporation lost Rs 211 crore, Industrial sector lost Rs 110 crore per day and Excise department lost Rs 300 crore.

The Sakala Janula Samme or the indefinite mass strike had a crippling impact on all the spheres of life in the State as the employees, teachers and workers of the two biggest public sector enterprises Road Transport Corporation and the Singareni Collieries had struck their work paralysing life.

The overall impact of the Telangana stir on the State’s economy was so high that it was likely to bring down the State’s gross domestic product by 0.72 per cent and translate to a loss in annual industrial production by 2.9 per cent.

According to a rough estimate by the Associated Chambers of Commerce and Industry of India (Assocham), the industry, trade and service sector in Andhra Pradesh had suffered a loss of Rs 10,000 crore in the first 25 days of the strike while the Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) has put the losses to the economy of the State at Rs 8,750 crore in the first 32 days of the strike.

FAPCCI president VS Raju said that the social unrest had resulted in total job losses of 60,000 in just one month.

Though the State Government has not yet come out with any figures of revenue losses, unofficial estimates put it to be more than Rs 3,000 crores.

To deal with these losses and possible fallout on the budgetary figures, the State Government has now gone on a spree of pruning all avoidable expenditure. The instructions issued by the finance departments to the Ministers and top officials include no meetings and conferences in five-star hotels, no air travel by business class and no foreign jaunts. Similarly the expenditure under the heads like entertainment, advertisements, travelling allowance and daily allowances have either banned completely or trimmed.

Similarly, instructions have been issued to put on hold the purchase of any new machinery by the Government departments and offices. The heads of the departments have been asked to review the number of contract employees recruited in the name of outsourcing.

Though the officials refused to directly link these measures to the impact of the Telangana strike, they were concerned about the fall in the revenues due to the strike specially in the commercial taxes and the excise.

According to the Principal Secretary(Finance) V Bhaskar, the measures were aimed at promoting the fiscal discipline and financial prudence. “It is to ensure that adequate fund were available for taking up developmental programmes,” he said.

Related posts:

  1. Coal production resumes, schools re-open in Telangana
  2. ‘Sakala Janula Samme’ completes 1 month
  3. ‘Sakala Janula Samme’ strike enters 25th day
  4. Excise employees join Telangana ‘Sakala Janula Samme’
  5. Assocham puts loss at Rs 10,000 cr
  6. Industry bandh to cost Rs 1,000cr in 2 days
  7. Stir over Telangana intensifies
  8. Telangana remains paralysed for second day
  9. Telangana staff gear up for indefinite strike
  10. JAC boycotts talks over proposed general strike

Leave a Reply

Spam protection by WP Captcha-Free