First of August… the AP government is dreading the very mention of this word. By this date, the AP Government needs at least Rs 10000 crore to pay the salaries of the employees, pensions of the retirees, and payment of various welfare pensions., besides making arrangements for daily expenditure of the government. The government might somehow or the other arrange for the welfare pensions. But, is there a guarantee that the government employees and pensioners will get their salaries and pensions on August 1?

The only way the government can pay the salaries is by taking an overdraft. But, the government has already taken an overdraft and now has no other way of borrowings. According to the directions of the 15th finance commission, the AP government has already overshot its borrowing limit.

This only means that the employees and pensioners may have to wait for some more days to get their salaries.. According to the 15th finance commission, the state government cannot borrow beyond Rs 4872 crore. This means it has already borrowed more than this amount. The state government may win accolades for the welfare schemes, but the governance is going down the drain under YS Jagan Mohan Reddy.

No attempt is made to mop up additional revenue and increase its sources of income. The AP Government is doing neither. At the same time, its welfare expenditure is hitting through the roof. As a result, the state appears to be heading for a financial doom. How long will Jagan keep on spending Rs 10000 crore every month without hiking taxes? What will be the public reaction if he hikes the taxes.