Andhra Pradesh is grappling with severe financial strain due to a shrinking revenue base, rising expenses, increased establishment costs, growing interest payments, welfare commitments, and the loss of its capital city as a major commercial hub, according to the AP Socio-Economic Survey 2024-25, presented in the state legislative assembly on Monday.
The survey, conducted by the state planning department, attributes this fiscal stress to expenditure commitments outpacing revenue inflows, coupled with lower-than-expected funds from the central government.
In 2024-25, Andhra Pradesh generated ₹94,967 crore in revenue from its own tax sources, including ₹36,296 crore from State Goods and Services Tax (SGST), ₹21,300 crore from state excise (liquor), ₹18,505 crore from sales tax, ₹9,200 crore from stamps and registration, and ₹4,655 crore from motor vehicle tax. Additionally, non-tax revenue amounted to ₹7,018 crore, with ₹3,518 crore coming from mines and minerals.
The state received ₹89,157 crore from central transfers, comprising ₹57,002 crore through tax devolution and Finance Commission grants, ₹17,036 crore in grants-in-aid, and ₹16,252 crore under externally aided projects. Comparatively, in 2023-24, Andhra Pradesh’s own tax revenue stood at ₹85,922 crore, non-tax revenue at ₹7,432 crore, and central resource flow at ₹84,157 crore.
Total expenditure (excluding ways and means advances and public debt repayments) increased to ₹2,49,418 crore in 2024-25 from ₹2,36,512 crore in 2023-24. Revenue expenditure rose to ₹2,24,343 crore from ₹2,12,450 crore, largely due to spending on welfare programs such as rice subsidies, power subsidies, old-age pensions, and housing schemes.
Public debt repayments surged to ₹21,102 crore in 2024-25, up from ₹13,070 crore the previous year. Meanwhile, capital expenditure on infrastructure projects, including irrigation and roads, stood at ₹24,072 crore, compared to ₹23,331 crore in 2023-24.
The state’s total debt rose sharply from ₹4,91,734 crore at the end of 2023-24 to ₹5,64,488 crore by the close of 2024-25—an increase of nearly ₹73,000 crore. This debt comprises market borrowings, central loans, small savings loans, provident fund obligations, and other sources.
Market borrowings alone grew from ₹3,66,565 crore in 2023-24 to ₹4,24,070 crore in 2024-25. Interest payments also increased, with the state paying ₹32,944 crore in 2024-25, up from ₹29,481 crore in the previous year.
