The Congress government is concerned over a significant revenue shortfall in recent months, with key income-generating departments missing projections and growth rates dropping to half the levels achieved under the BRS rule.
With state funds stretched thin, Finance Department officials report struggles to allocate resources for day-to-day expenses, raising doubts over fulfilling election promises. Even ongoing welfare initiatives are facing funding issues, leading to delays in launching new programs.
Reports suggest that the highly anticipated Indiramma Housing Scheme, initially scheduled to launch immediately after Diwali, has yet to commence, leaving many disappointed. Telangana has experienced consistent economic growth since its formation, barring setbacks during the pandemic, often registering an average growth rate exceeding 8 percent.
This track record has earned Telangana praise as an economic success story during KCR’s decade-long rule, with economists lauding its model as one other states should emulate. Yet, recent figures indicate a concerning trend: while the Commercial Taxes Department has shown some resilience, other revenue-generating sectors are underperforming. Consequently, the state’s income growth has slowed to just 4 percent in the past seven months—half the prior average.
Facing increased pressure from the public to deliver on election promises ahead of local body elections, the Chief Minister and Deputy Chief Minister have set up a cabinet sub-committee focused on revenue mobilization. In recent meetings with senior officials, they ordered the clearance of pending dues and encouraged revenue generation through measures such as one-time settlements.
Officials were instructed to pursue debt collections, including visiting debtors if necessary, and to explore land sales and mortgages to boost funds. Furthermore, contractors who haven’t initiated projects despite having permits from the mining department are being urged to start work or settle pending dues.
Some officials express frustration over what they describe as the government’s inconsistent policies, which they say are contributing to the revenue decline. They argue that the Stamp and Registration Department relies on active real estate transactions, which have slowed due to projects like the HYDRAA and Musi beautification initiatives, resulting in a revenue dip.
Additionally, excise targets and daily reviews have yet to yield the anticipated results, and officials cite difficulties in boosting revenue from other channels, such as vehicle sales, which have also tapered off.
In past years, the BRS government infused cash directly into the economy through programs like Rythu Bandhu, subsidies, crop purchases, and Bathukamma saree distribution, creating a cycle that sustained consumer spending and property investments.
However, in the Congress rule, delays in disbursements and a lack of clarity on certain initiatives have reportedly reduced cash flow in the market, impacting state revenue. Experts caution that without intervention, these financial challenges could worsen, potentially affecting Telangana’s economic outlook further.