From Where Jagan Getting Money For All Welfare Schemes?

The other day CM Jagan has announced a free Covid vaccine for all those who are between 18 to 45 years old. This is expected to benefit over 2,04,70,364 people in this age group. It is estimated that it is an additional burden of Rs 3000 crore on the public exchequer. Even ministers in the cabinet were shocked with Jagan’s decision to offer free vaccines for all. This comes at a time when the Centre has fixed a higher price for the states for vaccines whereas the Centre gets at much lesser price.

Welfare Schemes

Meanwhile, Jagan’s Navarathnalu welfare schemes have levied a huge burden on the exchequer of the state. The state government’s welfare schemes include Rythu Bharosa, Fee Reimbursement, Arogyasri, Jalayagnam, Amma Vodi, YSR Asara, YSR Cheyutha, Housing For All, Pension Kanuka, Jagananna Vidya Devena, Power Subsidy, Nethanna Nestham, Zero Interest Loans, and many more regular schemes. Recently, Jagan has also launched the Ration Door Delivery and several other schemes to people. Voluntaries have been recruited to ensure the schemes are reaching the people. These all schemes cost a big burden on the state. However, the free vaccination is going to add to the burdens of the cash-strapped state.

3.73 Lakh Crore Debts

Though AP is not the first state to offer free Covid vaccine and the states like Bihar, Jharkhand are offering free vaccines and many more states are likely to follow suit, however, AP is in much worse situation in terms of its financial state. The debt-laden state AP is facing a debt burden of Rs 3.73 lakh crore as per the CAG report in Jan 2021. At the time of bifurcation in June 2014, AP had a debt burden of Rs 97,000 Crore. It rose to Rs 2,58,928 Crore till March 2019. It peaked further during Jagan’s tenure. From April 2019 to November 2020, a whopping Rs 1,14,212.81 Crore loans were taken from banks and other sources with Rs 1,06,866.25 crore secured by Jagan administration since June 2019. As of Jan 2021, the total debts of AP stood at 3.73 lakh crore, confirmed by the CAG report. The Covid crisis has added stress to AP’s finances. There is an alarming increase in liabilities of AP over the time.

Raw Deal During Bifurcation

Ever since the state was bifurcated and got a raw deal, the truncated state has been going through one of its toughest phases ever. The capital woes of the state continue and the Centre hasn’t kept its promises in the AP Reorganisation Act 2014. Neither Special Category Status nor a Special Railway Zone nor the funds and institutions that have been promised on the floor of the Parliament and in the Act respectively are not met. After Chandrababu splurged on Amaravati and positioned it as the ‘People’s Capital’, soon after Jagan took over the reigns, he announced the decentralisation of capitals – Executive Capital, Legislative Capital and Judicial Capital. Visakhapatnam, Amaravathi and Kurnool have been picked as the respective capitals.

In this backdrop, the moot question is that where is Jagan getting money for all the welfare schemes? How is he managing to run the state with all freebies and schemes. This is certainly worrying many. No doubt, offering free Covid vaccine is a welcome move, but what about the state’s finances? How will Jagan strike a fine balance between the welfare schemes and the state’s finances? This is the million dollar question.