Wed Mar 05 03:00:51 UTC 2025: ## Andhra Pradesh Grapples with Severe Financial Crisis, Minister Reveals

**Vijayawada, March 5, 2025** – Andhra Pradesh is facing a severe financial crisis, with 90% of its revenue dedicated to salaries, allowances, loans, and interest payments, Finance Minister Payyavula Keshav revealed in the Legislative Assembly on Tuesday. This revelation came during a general discussion on the annual budget.

According to Mr. Keshav, the state spent ₹1,54,970 crore on these expenses in 2024-25, against a total revenue of ₹1,54,065 crore (including central government contributions). He contrasted this with neighboring Telangana, which allocates only 30% of its revenue to similar expenditures.

The Minister blamed the previous YSR Congress Party (YSRCP) government for pushing the state into this predicament, citing a 3% decline in the overall growth rate during their tenure. He claimed that maintaining the previous growth rate would have yielded an additional ₹76,195 crore. He also highlighted a significant drop in growth rates in the agriculture and services sectors.

Mr. Keshav further detailed the state’s debt burden, focusing on high-interest loans, some reaching 13.4%. The government is currently negotiating with banks to reduce interest rates on these loans, aiming to lower the annual interest payment and ease the financial strain. He specifically mentioned one loan of ₹154 crore with a 13.4% interest rate, noting that reducing this to 9% would save ₹6.76 crore annually. Similar negotiations are underway for loans totaling ₹1 lakh crore. The Minister expressed optimism that these negotiations would conclude by the end of the month, significantly reducing the state’s financial burden.

Read More