Telangana Congress government struggles to mobilise revenue amid fiscal strain

Telangana’s fiscal woes deepened in 2024-25, with State receiving only Rs 1.68 lakh crore against targeted Rs 2.21 lakh crore; instead of coming up with solutions, Ministers shifting blame by accusing officials of inefficiency

Hyderabad: Despite repeated high-level meetings and promises of a financial turnaround, the Congress government in Telangana appears to be still grappling with a serious resource crunch, struggling to generate additional revenue to keep the administration afloat. Instead of coming up with solutions to address the crisis, the Ministers are now shifting the blame, accusing officials of inefficiency.

Telangana’s fiscal woes have deepened in 2024-25, with the State receiving only Rs 1.68 lakh crore against the targeted Rs 2.21 lakh crore. Tax revenue was down to Rs 1.36 lakh crore from the projected Rs 1.64 lakh crore. While the State’s net borrowings stood at Rs 48,322 crore, the capital expenditure was around Rs 36,209 crore, which was propped up by debt rather than the State’s own revenue resources.

Multiple meetings of the Cabinet Sub-Committee on resource mobilisation, led by Deputy Chief Minister Mallu Bhatti Vikramarka and comprising key Ministers, have yielded little progress. The committee, which includes Ministers N Uttam Kumar Reddy, D Sridhar Babu and Jupally Krishna Rao, has reportedly expressed dissatisfaction over the poor performance of several departments, barring Commercial Taxes, which showed modest growth during the previous fiscal of 2024-25.

Repeated instructions from the Ministers are reportedly falling on deaf ears. In some meetings, officials have been accused of recycling old reports without offering new solutions. The lone bright spot remains the Commercial Taxes Department, which achieved 6 per cent revenue growth in March, though it fell short of the target. Officials across key revenue-generating departments — Excise, Mining, Revenue, Transport, Stamps and Registration, Commercial Taxes, Revenue and Housing — are under severe pressure from the political leadership to come up with tangible solutions to improve revenue.

However, official sources said they were blamed for the poor revenue with allegations of inefficiency and inaction, despite the political leadership giving no clarity on the priorities and route map.

“The political leaders want the officials to perform our best, but also expect us to accommodate all their personal interests and financial requirements. Rather than releasing funds for welfare programmes and improving capital expenditure which could have ensured circulation of money in the market, the government is clearing pending bills and advances of certain ruling party leaders, including some Ministers, which is precisely the reason for lack of funds for various schemes,” lamented a senior official in the Revenue Department on condition of anonymity.

While the government recently rolled out an action plan to enhance revenues by identifying costly land parcels, boosting excise income, accelerating construction permits and streamlining sand sales through tribal societies, sources said there has been little progress. Even as apartment sales showed promise, expected gains from open plots and agricultural land remain elusive.

Unless it plugs revenue leakages and takes concrete steps to stabilise the State’s finances, the Congress government’s credibility will take a further beating and the government might have to think twice even for routine expenses.