Union Budget 2024: All eyes on Naidu's wish list

Hyderabad: With Finance Minister Nirmala Sitharaman set to present the Union Budget 2024, the question remains- will TDP's wish list be honoured?

Since TDP is the second largest party in the NDA, with 16 Lok Sabha MPs, the country is curiously awaiting the impact of coalition politics on the budget.

In his two visits to the national capital in the last 20 days, TDP chief and Andhra Pradesh chief minister, N Chandrababu Naidu, submitted a wish list to the Centre.

During his visit to Delhi in the first week of July, Naidu met the Prime Minister, Narendra Modi, and half a dozen Union cabinet ministers. On July 16, he again visited Delhi and met Union Home Minister Amit Shah.

Naidu's wish list included a special financial package for the backward region on the lines of the 'Bundelkhand Package', industrial incentives, funds for the construction of Amaravati capital city and Polavaram multipurpose project, short-term handholding of state finances, and additional allocations under the Scheme for Special Assistance to States for capital investment, targeting essential sectors such as roads, bridges, irrigation, and drinking water projects.

Industrial incentives are a critical part of special category status. Instead of pressing for special category status, Naidu has been gunning for industrial incentives.

He was also critical and particular about the announcement of the proposed BPCL refinery for Andhra Pradesh.

“Request BPCL to set up a refinery in AP as per Section 93(4) of the AP Reorganisation Act 2014. An announcement towards the establishment of a refinery in Andhra Pradesh by the Ministry of Petroleum and Natural Gas in the full budget address of the Finance Minister will augur well for increasing the refinery capacity of the country in its journey towards the country’s ambitious vision to transform into a developed entity by the centenary of its independence in 2047,” he sought from the Union Petroleum Minister.

Sources in the oil industry said that BPCL has a proposal to establish a greenfield refinery with an investment of around Rs 50,000 crore in the project and is currently assessing locations in Andhra Pradesh, Uttar Pradesh, and Gujarat.

BPCL's top brass, led by the company's CMD, G Krishna Kumar, met Naidu in Amaravati recently and held preliminary talks on the proposal.

BPCL's team hinted to Naidu that they would need at least 4,000 to 5,000 acres of land to set up the refinery. The Andhra Pradesh government, according to sources, may offer BPCL land in Machilipatnam, which also has a proposed sea port, for the refinery's establishment.

Currently, BPCL operates three refineries in Mumbai, Kochi, and Bina in Madhya Pradesh, with a combined annual refining capacity of around 36 MMTPA, and the new proposed refinery may have a capacity of 12 MMTPA.

Another big-ticket project that Naidu sought was the sanction of the Outer Ring Road (ORR) for Amaravati, which is estimated to be around Rs 25,000 crore.

The "Outer Ring Road(ORR) project was conceived and was under active consideration in 2018. Naidu urged union road transport and highways minister Nitin Gadkari to reconsider the project for immediate sanction, as it will have a phenomenal impact on the development of the new capital of Amaravati. He also sought an integrated aquapark for Andhra Pradesh.

“The fiscal situation in Andhra Pradesh has significantly deteriorated due to the previous government's misadventures and absence of a strategic long-term development plan. On account of unproductive expenditure and fiscal hara-kiri marked by exploitation of natural resources for personal use and no focus on the development of human resources, growth has plummeted, revenue receipts have tapered, and liabilities have peaked. The aspirations of the people of Andhra Pradesh were paid no heed by the previous government, as the wake of its misgovernance is marked by huge unpaid liabilities and no investment in crucial infrastructure like the Polavaram project, water resources, roads, and capital city,” Naidu told Modi.

Naidu also stated that Andhra Pradesh's financial resources remained severely constrained. Committed expenses, including salaries, pensions, and debt servicing, exceed the state's revenue receipts, leaving no fiscal space for productive capital investment.

The situation has reached such an impasse due to the gross mismanagement of state finances by the previous government.

“Indiscriminate borrowing marked by hypothecation of future excise revenues and pledging of government buildings, combined with large-scale diversion of monies, has resulted in a situation of high public expectation and acute scarcity of resources. There is no other way to face such a challenge except by way of financial handholding by the central government,” Naidu observed.