The AP government under the ruling party YSRCP managed to get a total fund of 2300 crores of rupees as new debts from the banks of India. Against the warnings of the apex bank of India, some banks lent huge amounts to the Jagan government.
It is a known fact that the Reserve Bank of India warned the Andhra Pradesh government on its long-standing Overdue Draft declaring that it would cut off all funds if it fails to pay the outstanding amounts. Going nowhere, the AP Government used its corporations to apply for loans in various banks as a guarantee to get out of this urgent financial pit. Union Bank and Bank of Baroda considered three state corporations and lent 2300 crores even though RBI warned them earlier to consider the financial situation of the state before lending money. With this amount, AP immediately paid 2000 crores of rupees to get out of the overdue stand and paid 300 crores to the government employees as salaries. Even after this debt, AP still has to pay as much as 2500 crores of rupees to the RBI under various means and special drawal limits.
Financial experts scratch their heads regarding how the AP government got into debt despite continuous warnings of the RBI to the Indian banks. Seems the secret nexus with the central party BJP might have worked wonders, opines a political expert.