Andhra Pradesh Faces Deepening Fiscal Crisis, Jagan Cites CAG Data
YS Jagan Mohan Reddy warns of Andhra’s economic decline, alleging corruption and stagnant revenues under TDP-led government.
YSRCP chief and former Chief Minister YS Jagan Mohan Reddy raised alarms over Andhra Pradesh’s deteriorating financial health, citing Comptroller and Auditor General (CAG) data for the first quarter of FY 2025-26. In a post on X, Reddy described the state’s fiscal outlook as “precarious,” pointing to a mere 3.47% year-on-year growth in state revenues and a 6.14% rise in total revenue receipts, including central transfers, indicating heavy reliance on external funds to meet expenditure.
Reddy highlighted that GST and sales tax revenues, key indicators of consumption, declined compared to the already subdued figures from the same period last year. He attributed the state’s “lost economic buoyancy” to dismal growth in tax and non-tax revenues, with some categories showing negative growth. “The CAG’s monthly key indicators reveal a stark reality of fiscal stress, worsened by rampant corruption,” Reddy claimed, criticizing the TDP-led NDA government’s financial management.
The opposition leader noted that Andhra Pradesh, still reeling from the 2014 bifurcation, faces unique challenges in public finance management. “Only strategic government spending on welfare and development can spur private consumption and investment,” he said, warning that the state’s current trajectory risks economic stagnation. The CAG data also revealed a 15.61% surge in public debt in Q1 alone, underscoring unsustainable borrowing trends.
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Reddy’s remarks follow earlier criticisms in June 2025, where he flagged a 24.20% contraction in state GST revenues for April 2025 compared to April 2024, accusing the government of masking distress with misleading claims of record GST collections. The TDP-led government has yet to respond to these allegations. Meanwhile, Andhra’s economy, projected to reach a GSDP of Rs 18.3 lakh crore in FY26, faces scrutiny as Reddy’s claims contrast with the state’s infrastructure and investment growth narrative.
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