Andhra Pradesh Financial Position In Danger: RBI

AP Financial Position in Danger

The financial situation of Andhra Pradesh has been slipping to Over-Draft (OD) almost every month since bifurcation. Economists kept warning about the danger zone and now even Reserve Bank of India confirms the dire state.

As per the latest info, AP have Rs 1,563 crore of Over-Draft. State Government slipped to OD on 2nd of January. Actually, OD declined in the month of December 2017. But now, It’s been souring to raise concerns about the financial deficit AP gonna face in February.

Since January 1st this year, AP has been in OD for 13 days. If a state continues in OD for 14 days at a stretch, That’s a very alarming sign & RBI would even stall few funds to states in such a situation. So, One can assume how worse the situation of AP is turning out to be day-by-day.

RBI Norms: Any State shouldn’t be in OD for two weeks continuously. Ways & Means advance shouldn’t be surpassed in five working days. If remained in OD for 36 days in a Quarter, State shouldn’t go for ways & means for a period of 36 days.




Already, AP has been in OD for four working days at a stretch. It’s in OD for 13 out of 33 days already. Can it stay away from OD for less than 23 days in the remaining 55 to 57 days?

Debts of AP might increase due to more borrowing for compensating financial deficit. How would TDP Government handle this challenge?

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