Gopavajhala Diwakar
During the first five months of the current financial year (April-August), Andhra Pradesh’s revenue deficit had already exceeded the full-year target of Rs 22,000 crore, touching Rs 36,932.71 crore — about 168 per cent of the budget estimate.
Revenue receipts during the first five months stood at Rs 72,787.67 crore, or about 31 per cent of the budgeted Rs 2,34,140.14 crore. Borrowings, however, showed a much stronger pace, with nearly 70 per cent of the budgeted amount achieved.
The State spent Rs 13,377.11 crore on capital expenditure during the first five months, against the full-year target of Rs 47,830.81 crore — about 28 per cent of the target.
In 2025-26, the State Government spent Rs 26,864.91 crore on capital expenditure, little over 66 per cent of the budgeted Rs 40,635.72 crore. A year earlier, in 2024-25, capital expenditure stood at Rs 16,141.28 crore.
In other words, the N. Chandrababu Naidu-led government spent around Rs 40,000 crore on capital expenditure during its first two years. Even if the Government achieves 100 per cent of this year’s capital expenditure target, cumulative capital expenditure during the first three years would be around Rs 87,831 crore.
This assumes, of course, that the current year’s budgeted capital expenditure is fully utilised.
The figures assume greater significance when viewed against the ambitions laid out in the Swarna Andhra Vision 2047.
The Vision document projects Andhra Pradesh’s economy to grow at more than 15 per cent annually over the next five years, with GSDP expected to approximately double along with per-capita income. GSDP, which stood at Rs 14.39 lakh crore in 2023-24, is projected to reach Rs 29.29 lakh crore by 2028-29.
That is an extremely ambitious trajectory.
A recent presentation by Chief Minister Naidu put the average growth of Andhra Pradesh’s GSDP during the past two years at 11.3 per cent at current prices. If measured in real terms, after adjusting for inflation, the growth rate would necessarily be lower.
The question, therefore, is not whether Andhra Pradesh should have an ambitious economic vision, but whether the investment and fiscal trajectory required to achieve that vision is visible in the State’s finances.
To achieve the aspirational target of adding roughly Rs 15 lakh crore to GSDP by 2028-29, the Vision document estimates that more than Rs 40 lakh crore of investment will have to be mobilised. The estimate is based on gross capital formation ratios drawn from the Government of India’s National Accounts Statistics.
The CM time and again says the state has attracted investments of Rs 20 lakh crore that would create five lakh jobs . However, it is not clear how many of them were grounded.
Of the more than Rs 40 lakh crore total investment envisaged, private investment is estimated at Rs 31.14 lakh crore, or about 77 per cent, while public investment accounts for roughly 23 per cent.
Among the 9.29 lakh crore estimated public investments Rs 4.8 lakh crore will be financed through state government budgetary support. Central government institutions and PSUs will invest 2.5 lakh crore while the remaining 2 lakh crore will be mobilized through innovative mechanisms by state government institutions and PSUs.
This is the critical assumption underlying the Vision.
The Vision also requires the overall investment rate to rise from 31.14 per cent of GSDP in 2023-24 to 32.45 per cent in 2028-29.
The gap between this ambition and the present scale of State expenditure deserves closer scrutiny.
The State’s capital expenditure, even assuming the current year’s target is fully achieved, would amount to around Rs 87,831 crore over the first three years of the present government. That leaves a very substantial gap between the actual pace of capital spending and the Vision’s projected Rs 4.8 lakh crore in State budgetary support.
The NDA government has only about two full budget cycles left before the 2029 Assembly elections. Since an election year normally involves a vote-on-account rather than a full-year budget, the window for implementing large-scale investment commitments is even narrower.
The vision achievement will depend not merely on higher budget allocations, but on the State’s ability to raise its own revenues, manage its debt and fiscal deficit, contain the pressure of revenue expenditure, improve capital-expenditure execution and, above all, crowd in the massive private investment assumed by the Vision.
Swarna Andhra has set an ambitious destination. What is still less visible is the financial and investment road map needed to get there.
