Date:26/12/2007 URL: http://www.thehindu.com/2007/12/26/stories/2007122661610400.htm

Andhra Pradesh - Hyderabad

Finance Department in a piquant situation

HYDERABAD: The government’s decision to revive the scheme for supply of rice at Rs. 2 a kilo to white card holders from April 1 and extending Aarogya Sri to the entire State by December has landed the Finance Department in a piquant situation.

The department is already working overtime to identify sources for funding the Rajasekhara Reddy government’s pet schemes like Indiramma and Jalayagnam.

While the allocation to Indiramma is likely to exceed the previous year’s Rs. 5,400 crore, budget for Jala Yagnam is expected to be around Rs. 20,000 crore next year as the work on various irrigation projects has reached a critical phase.

The subsidised rice scheme alone will entail an additional burden of Rs. 1,000 crore. The health insurance cover under Aarogya Sri for all the BPL families will also have a significant financial impact, which is yet to be exactly assessed. The recent decision to enhance the excise duty on certain brands of liquor will no doubt fetch the government about Rs. 800 crore, but the amount will be insufficient to meet the cost of the new commitments.