AP Report 2019-final

city and surrounding areas, and are
consequently inherited by the Telangana State.
Fifth, because of over-centralization of power,
all specialized administrative and training
facilities were located in Hyderabad city,
creating a void in the Successor State of
Andhra Pradesh.
Finally, because of the dominance of
Hyderabad city as a commercial and financial
centre, it houses almost all corporate offices
of the industrial and commercial enterprises
existing in Residual Andhra Pradesh;
consequently tax assessment and collection of
revenues by the State were from Hyderabad
city in respect of almost all enterprises located
in Residual Andhra Pradesh. However, the
Andhra Pradesh Reorganisation Act (APRA),
2014 created an anomalous situation
regarding refund of taxes and recovery of
arrears of taxes and duties causing loss to the
Successor State of Andhra Pradesh.
With the loss of a major metropolis, Residual
Andhra Pradesh has the lowest contribution of
services sector to the GSDP (46%) among
Southern States, and much lower than national
average (53.66%). Correspondingly, the
contribution of agriculture is highest in Andhra
Pradesh (31.77%) among the Southern States,
and much higher than the national average
(17.32%).
As a result, while Andhra Pradesh now has
58.32% of the population of the erstwhile State
of Andhra Pradesh, government revenues are
only 46%. Consequently, according to the
report of the 14 th Finance Commission, Andhra
Pradesh is the only State in India other than
the Special Category States to have a
projected revenue deficit continuing even in
2019-20. That Residual Andhra Pradesh
suffered considerable disadvantage in terms
of government revenues can be demonstrated
by the fact that the 14 th Finance Commission
estimated that post devolution, it would
have a revenue deficit of Rs. 22,113 Crore
from FY 2015-16 to 2019-20, whereas
Telangana State would have revenue surplus
of Rs. 1,18,678 Crore during the same period.
Broad Sector-Wise GVA / GSDP / GDP estimates of the Southern States
(All India at current prices and its contribution)
Table 0.1
Rs.in Crore
Source : AP Government’s Detailed Note on Issues Related to AP ReorganizationAct, 2014
dated 12 January 2018 submitted to Prime Minister
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