Andhra Pradesh Chief Minster N. Chandrababu Naidu has raised the challenges arising out of the State bifurcation in 2014 and the unresolved issues before the 16th Finance Commission.
A delegation of 16th Finance Commission, headed by its Chairman Arvind Panagariya, visited the Secretariat at Velagapudi on Wednesday.
After the State’s bifurcation, most of the revenue-generating resources went to Telangana and the residual Andhra Pradesh had to rely predominantly on the primary sector, the Chief Minister pointed out.
In 2014, 31% of Andhra Pradesh’s income came mainly from the agriculture sector while Telangana received only 16% of its total income from the sector.
Andhra Pradesh had a 25% share of revenue from the industrial sector, while Telangana had 22%. In the services sector, Andhra Pradesh’s share was 44% when compared to 61% in Telangana, he said.
Andhra Pradesh lost access to national institutions, educational and medical institutions, and several Central government bodies. As per Schedule 9 of the A.P. Reorganisation Act, the division of 91 public sector companies and corporations, worth ₹1.63 lakh crore, was still pending, Mr. Naidu pointed out.
Division of assets
“Under Schedule 10, the division of assets worth ₹39,191 crore belonging to 142 institutions has not yet been completed even as 10 years have passed since the bifurcation,” Mr. Naisu said.
“After bifurcation, the residual State lost Hyderabad and the revenue generated by it. Hyderabad now generates nearly 75% of the total revenue in Telangana. This has contributed to Telangana’s economic growth and increase in per capita income, putting Andhra Pradesh at a disadvantage,” he said.
The Chief Minister said the per capita income of the residual Andhra Pradesh was ₹93,903 at the time of bifurcation, while the same was ₹1,24,104 for Telangana.
During the first five years after the bifurcation, the per capita income of the residual State rose by 13.21%, reaching ₹1,54,031. During the same period, Telangana’s per capita income increased by 13.37% to ₹2,09,848.
Between 2019 and 2024, Andhra Pradesh’s growth in per capita income dropped to 9.18%, whereas Telangana recorded 11.45%.
By 2023–24, Andhra Pradesh’s per capita income stood at ₹2,37,951, while the same for Telangana was ₹3,56,656.
“Due to bifurcation and the policies of the previous government, the income gap between Telangana and Andhra Pradesh has widened significantly. Among the South Indian States, Andhra Pradesh now has the lowest per capita income,” Mr. Naidu said.
Rising revenue deficit
Andhra Pradesh’s revenue deficit is rising year after year. In the current financial year, it stands at ₹1,28,146 crore, and it is estimated to reach ₹1,43,640 crore by 2030–31 fiscal.
The State’s committed expenditure—such as interest payments, pensions, and salaries—has exceeded its revenue. In 2023–24, the total committed expenditure stood at ₹1,03,220 crore, while the revenue was only ₹93,410 crore. “The committed expenditure was 110.6% of the revenue, placing a heavy burden on Andhra Pradesh,” he added.
Published – April 16, 2025 11:04 pm IST
