Telangana is ready to settle the power utilities dispute with Andhra Pradesh through mutual agreement if APGENCO withdraws the court lawsuit.
K Ramakrishna Rao, Special Chief Secretary (Finance and SR), notified the Centre. Telangana was also adamant that any revision to the Andhra Pradesh Reorganisation Act, 2014, to remove inconsistencies in taxation concerns after seven and a half years would result in perpetual litigation and complicated subjects that had already been resolved.
Ramakrishna Rao was addressed during a video conference organised by the Joint Secretary of the Ministry of Home Affairs (MHA) to carry out preparatory work and offer practical solutions to bilateral concerns resulting from APRA between Telangana and Andhra Pradesh. The MHA Joint Secretary agreed with Telangana’s views on taxation concerns and ruled that this was not a bilateral issue, hence it was deleted.
At the meeting, five critical problems were reviewed, including TSDISCOM’s payment of power dues to APGENCO and the division of Andhra Pradesh State Financial Corporation (APSFC).
Following the payment of electricity dues to APGENCO by TSDISCOM, it was revealed at the meeting that the total dues recoverable from AP to Telangana power utilities was Rs.12,532 crore after deducting dues owed to APGENCO. In response, AP requested a payment of Rs.3,442 crore from the Central Government, which is payable by TSGENCO as a single settlement.
Telangana, on the other hand, believed that instead of piecemeal settlement, total outstanding amounts relating to electricity dues by each State should be combined. The Central Government was informed about APGENCO’s abrupt cessation of power supply to Telangana following the formation of the State, as well as Telangana’s efforts to purchase power at high market rates due to the unilateral cancellation of PPS entered into in the combined State with Hinduja National Power Corporation, AP Power Development Corporation, and Krishnapatnam Power Plant.
Telangana was deprived of low-cost hydropower from the Sileru hydropower project, forcing TSDISCOMs to acquire high-cost power and incur massive financial losses as a result. When all dues are considered, such as debt servicing for the districts of Ananthapur and Kurnool, as well as costs spent due to the purchase of thermal power, Telangana utilities must receive a net amount of Rs.12,532 crore, not the other way around, Telangana pointed out.
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The MHA Joint Secretary was also apprised about the High Court petition filed by APGENCO for payment of power dues despite Telangana’s claims.
Concerning the division of Andhra Pradesh State Financial Corporation (APSFC), it was revealed that AP had unilaterally sent demerger proposals of APSFC to the Central government for approval without the consent of Telangana on the basis of a resolution passed by the Board, which lacked Telangana representation.
The MHA Joint Secretary was notified about the Telangana government’s proposal in May 2016 to reconstitute the Board of APSFC in order to have equal representation for Telangana in the Board by utilising the powers of the Central Government under Section 71 (b) of APRA, which is still pending. Telangana has asked the Centre not to sanction the APSFC demerger proposal after learning of AP’s unilateral decision.
AP further went to court and won status quo orders against the recovery of Rs.235.34 acres given to the State Finance Corporation for breach of allocation terms. Another point of contention is the ownership of the SFC building in Nanakramguda, which, according to APRA, is an operational unit rather than the headquarters office.
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Because of the foregoing three concerns, including the legal cases brought by AP, the question of the APSFC split was pending. As a result, Telangana has taken the position that further progress on the splitting of APSFC cannot be made unless court cases are dismissed.
In relation to the separation of cash balances and bank deposits, Telangana made a strong demand that the money owed to Andhra Pradesh be settled soon and payment made.
In the case of central sector projects, an amount of Rs.495.21 crore is owed over a period of more than seven years. Similarly, Andhra Pradesh had consented to and given undertakings for payment of amounts of money spent on common institutions such as the High Court, Raj Bhavan, and so on, totalling Rs.315.76 crore. Even money received as a portion of the Building and Other Construction Workers Welfare Board (BOCWWB), the Labour Welfare Board fund of Rs.464.39 crore, and the resumption of Net Credit Carried Forward (NCCF) of Rs.208.24 crore are not paid.
The MHA Joint Secretary has requested that Telangana furnish information on cash balances and bank deposits owed to Andhra Pradesh. The issue of Cash Credit by APSCSCL and TSCSCL was also addressed.
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