RBI warns AP Govt on exceeding loan limits

Monday, March 4, 2024

The Reserve Bank of India has sent its initial warning to the government of Andhra Pradesh regarding its long-standing overdue drafts regarding the loans it had taken. A leaked letter from the RBI directing to the AP Finance Department revealed this news.

The GM of the central bank wrote to the principal secretary of the AP Finance department citing the outstanding loan amounts and their overdue in this quarter of the fiscal year. According to the letter, the Overdue shall not be maintained by any state for more than five consecutive days and if the state crosses more than five days, it will stop the financial support unconditionally. RBI provided the details that the AP was in OD limit since the 1st of December and issued a warning when it consecutively stayed until the 8th of December. In total, AP stayed in OD for 19 days in this fiscal year. The central bank suggested the state pay salaries to the employees or else it shall intervene in the role of a banker to the state. The manager of the RBI also asked the state to clear the pending or else the state shall be pushed into a huge financial chaos.

As of now, the AP government is tight-lipped on this letter and responded nothing officially to the press. Political critics point out the fact that the RBI along with the central government warned AP already regarding its finances many times in just the current fiscal year. All are blaming Jagan’s Navatarnas for unwisely using the state’s resources. 

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