Published: 12th April 2014 09:13 AM
Last Updated: 12th April 2014 09:13 AM
Officials are wracking their brains on how to distribute the
liabilities between Telangana and Seemandhra states. The borrowings
taken for specific projects in the combined state can be apportioned
between the two states as per their location.
The state government which has borrowed and allocated money to specific projects will not have any problem. But if the loan amount was not indicated in the budget for a specific project, then it should be apportioned on the basis of population. This will lead several problems in future, sources in the finance department say.
For example, the Central Power Distribution Company Limited (CPDCL) borrowed money to the tune of Rs 4,000 crore by mortgaging the assets of EPDCL. The loan amount was used by CPDCL to supply power to the citizens of Hyderabad. But the loan was shown in the EPDCL books and its assets were mortgaged. The CPDCL may claim that there was no loan against it and EPDCL may contend that the loan was used for CPDCL. Such problems may arise on apportioning liabilities, sources explain.
In case of external borrowings from JICA, World Bank and others, they were mentioned specifically for a particular project. There would be no problem in apportioning such loans. But, the state government borrowed money and sanctioned money under pressure from political leadership for any project, then the problem will arise.
Officials have decided to make separate cells for Telangana and AP in corporations and other institutions which will serve both the states even after Appointed Day. The power to divide corporations and companies is vested with the central government. Demerger has to take place with the approval of the ministry of corporate affairs. Officials sought the permission of the central government to give the power to state government to divide these corporations and companies as a special case.
The state government which has borrowed and allocated money to specific projects will not have any problem. But if the loan amount was not indicated in the budget for a specific project, then it should be apportioned on the basis of population. This will lead several problems in future, sources in the finance department say.
For example, the Central Power Distribution Company Limited (CPDCL) borrowed money to the tune of Rs 4,000 crore by mortgaging the assets of EPDCL. The loan amount was used by CPDCL to supply power to the citizens of Hyderabad. But the loan was shown in the EPDCL books and its assets were mortgaged. The CPDCL may claim that there was no loan against it and EPDCL may contend that the loan was used for CPDCL. Such problems may arise on apportioning liabilities, sources explain.
In case of external borrowings from JICA, World Bank and others, they were mentioned specifically for a particular project. There would be no problem in apportioning such loans. But, the state government borrowed money and sanctioned money under pressure from political leadership for any project, then the problem will arise.
Officials have decided to make separate cells for Telangana and AP in corporations and other institutions which will serve both the states even after Appointed Day. The power to divide corporations and companies is vested with the central government. Demerger has to take place with the approval of the ministry of corporate affairs. Officials sought the permission of the central government to give the power to state government to divide these corporations and companies as a special case.
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