Hyderabad: With the state in a financial crisis, Chief Minister K. Chandrasekhar Rao has allotted the finance portfolio to Mr T. Harish Rao, known to be a trouble shooter for the TRS.
As irrigation minister in the previous administration, Mr Harish Rao had successfully achieved the goals set, completing Mission Kakatiya to clean lakes and overseeing the quick construction of the Kaleshwaram project.
To overcome the financial crisis will not be so easy.
TRS circles believe Mr Chandrasekhar Rao had allotted the finance portfolio to Mr Harish Rao because of his ability to weather a crisis. Opposition parties say that allotting the finance portfolio is a form of punishment.
The finance minister's main task will be increasing the state's revenue which has come down drastically according to the government's own estimates. After the Goods and Services Tax was imposed, much of the state's revenue streams have closed.
It can collect user charges in government offices and hospitals, for example, but this will have a negative impact on the government and will affect the TRS politically.
The only way of increasing revenue is through the excise and stamps and registrations departments for the state government
The state government has to pay pending bills of around Rs 30,000 crore to several contractors in various departments. Unless the government clears these bills, contractors will not take up new work.
Then, to implement the election promises the party made, the government requires around Rs 70,000 crore.
It is very difficult for the state government to generate additional revenue on its own, and with the economic recession and not very cordial relations with the Central government, funds from the latter will not be forthcoming either. And this will be more so if the recession lasts for some time.
There is a tendency on the part of other ministers and government departments to blame the finance department if funds are not forthcoming. The finance minister has to be cautious about disbursing funds even when times are good. How Mr Harish Rao will negotiate this minefield to the satisfaction of everyone will be interesting to watch.
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The TRS government has repaid around Rs 7,000 crore and the current debt is Rs 69,000 crore, apart from the loans taken for the irrigation projects.
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