Previous Budget Speeches



Speech of

Sri K.Vijaya Bhaskara Reddy

Hon'ble Finance Minister while Presenting

The Budget for 1971-72

To The Andhra Pradesh Legislative Assembly

on 30th July, 1971.



I rise to present the Budget of Andhra Pradesh for the year 1971-72.

I had presented to this Honourable House in March this year an Interim Budget seeking a " Vote-on-Account" for a period of six months up to the end of September, 1971 and I had indicated at that time that I shall come before the House later in the year with the final Budget. It is in fulfilment of this commitment that I place before you today the final Budget Estimates for 1971-72.

People have reaffirmed, in a larger measure than in the past, their faith in socialism through the decisive verdict given by them in the elections to the Parliament. A reorientation of the policies in the key sectors of the economy has already been under taken by the Government of India, covering a wide area including the vital institutions in the field of banking and general insurance. It is the responsibility of the State Government, in its term, to respond in suitable terms to the aspirations of the masses of our people. I, therefore, consider that it will be appropriate on my part to highlight at the outset the changes in the direction and content of activities of our Government in the recent years.

Basically, the efforts of the Government have been directed towards the achievement of a rapid rate of growth in which primacy of importance is accorded to those sections of the society which are farthest removed from the national minimum relating to basic needs. In an unequal society like ours, any socialist programme of action has necessarily to be based on the identification of the less developed sections of society, under-developed areas and the need for corresponding structural changes in the existing institutional frame-work. It is in this view that variety of programmes and policies, each distinct in itself and directed towards differing objects but forming part of a common and larger programme of action becomes relevant and significant.

In an economy in which a larger majority of the people are dependent on agriculture, no basic change is possible unless determined and definite measures are taken for the redistribution of land. The House is aware of the crash land assignment programme under which more than a million acres have been distributed since November,1969. This has conferred substantially benefits on the landless poor,Particularly the Harijans and Girijans. The Government are also making available to the landless poor, the vast extents of land taken over under the land legislation. A similar time-bound programme for providing house-sites to Harijans has been initiated recently. The establishment of Housing Federation for Scheduled Castes and Scheduled Tribes for undertaking a large-scale House construction programme for these sections of the society has been completed and the programme of construction is to be commenced shortly.

Honourable Members are fully aware of the series of measures initiated and implemented by the Government in the recent years for the welfare of the Scheduled Tribes. Apart from a more effective and purposeful implementation of the protective legislation in favour of Scheduled Tribes in scheduled areas a comprehensive ten crore programme of tribal development is under implementation. Perhaps, for the first time in the country, a separate line of credit both short-term and medium-term has been opened to the Girijans, through the agency of the Girijan Corporation and what is significant in this process is the involvement of the credit agencies including the Reserve Bank of India in tribal development. The large set-up in the budgetary allocation for the welfare of the Scheduled Tribes, Scheduled Castes and other Backward classes--to which I shall refer again later--reflects the policy of the Government to attach overriding priority to the measures designed to secure the amelioration of the conditions of living of these weaker sections of the society.

I should also refer, in this connection, to a package of schemes which have been taken up for implementation since last year, representing a new thinking and a new beginning in securing growth with social justice. The Rural Works Programme which aims at the creation of employment opportunities to landless agricultural labour has its significance not only in the creation of productive works in drought effected areas of the State, but also in its immediate impact on the unemployed landless labour in the rural areas. The Small Farmers Development Agency is designed to secure the benefits of institutional finance and agricultural improvement to the smaller farmers who had lagged behind in the process of agricultural progress.

TheMarginal Farmer and Agricultural Labourers scheme is yet another which envisages the channeling of credit and provision of improved in-puts along with the creation of employment opportunities for the less available sections of the farming community and landless agricultural labour.

Sir, permit me to say at this stage that what we are visualising is not a mere series of programmes are isolated schemes though everyone of the schemes has its distinct purpose and direction in catering to the needs of a relatively less developed section of the society. The object of the Government is a comprehensive and integrated development of the weaker sections of the society in fulfilment of a social commitment and as part of a larger socialist philosophy.

I may draw the attention of the House at this stage to certain other measures which have been undertaken by the State Government for furthering the socio-economic transformation along desired directions. The House is aware of the recent amendments to the Land Ceiling Act for making the operation of the Act more effective. While this measure is directed against the glaring disparities in rural wealth, an appropriate policy is being evolved in respect of urban wealth also. A committee has been set up to recommend a suitable policy in respect of ceiling on urban property and Government hope to take a final decision within a very short time after its report is received.

This Government is firmly of the view that the Constitution should be amended to enable the abolition of privy purses and privileges, to confer immunity to laws providing for acquisition by the State of any property or right and for bringing about other changes necessary for effectively meeting the urges of the people.

Before preceeding further, I may inform the House of our determination to reoriented the administrative structure to meet the changing needs of the changing times. No Government can hope to implement its policies properly and adequately unless the administrative machinery is gared to the task of development and is fully informed of the larger social purpose. Government have already indicated their intention to make the administrative machinery more responsive and more imaginative. We hope that within a short period, it should be possible for us to streamline the administration, providing for a greater devolution of real responsibility, the Power for decision making and implementation, performance oriented financial control, rational utilisation of technical personnel and greater sympathy in dealing with the problems of the common man. The different departments and the District Collectors have been directed to take suitable steps before the middle of August to eliminate delays and to draw up schemes for larger delegation of powers.

I shall now briefly review the activities of the various departments and outline their major programmes.


The main approach in respect of agricultural programmes is to intensify the efforts to increase per-acre yields of the major crops of the State, along-side with the extension of coverage of larger areas under the High Yielding and Hybrid varieties of both food and non-food crops. The programme is to be implemented over an area of 30.25 lakhs acres during 1971-72, as against 16.51 lakh acres covered last year. With the evolving of new varieties year after year, the scope for extending the area under its cultivation is on the increase. Indeed, a large part of the credit should go to the farmers for the enthusiasm with which the new ideas are being adopted.

Measures for development of cotton have been taken up both for increasing area under irrigated cotton and for increasing production from rain-fed cotton by application of fertilisers and taking up plant protection measures. Irrigated American long staple and extra long staple cotton being developed by taking up schemes both as State schemes and Centrally Sponsored schemes. Growing of cotton as a Rabi crop after the harvest of paddy has been developed success fully in the Krishna delta and an area of 36,000 acres was covered during 1970-71. There is a potential to develop cotton in a lakh of acres under rice fallows, from which about 75,000 bales of superior type of cotton like Krishna and MCU-5 can be obtained. Another significant achievement is the development of the extra-long staple cotton MCU-5 under the Nagarjunasagar Project in Guntur and Ongole districts. A Centrally Sponsored Scheme is being implemented for this purpose, the coverage during 1970-71 being 10,000 acres. During 1971-72, it is proposed to cover 25,000 acres under this scheme. Irrigated superior types of cotton are also being developed in Mahaboobnagar, Karimnagar, Nalgonda, east Godavari, west Godavari, Nellore and Kurnool districts under different Irrigation projects and wells. In respect of rain-fed cotton, schemes have been taken up for increasing the production by application of fertilisers, foliar spray of urea and taking up plant protection measures. A special scheme for increasing production of rain-fed Laxmi Cotton in Kurnool district as an Intensive Cotton Development Programme in 50,000 acres at a total cost of Rs. 23.9 lakhs has been sponsored by Government of India and it is being taken up during this season. Government of India has been requested to approve a similar scheme for cotton and Adilabad district.

Development of Mesta is receiving increased attention. It is proposed to cover 50,000 acres under had schemes in Srikakulam and Visakapatnam districts at a cost of about Rs. 11.5 lakhs.

To meet the increasing demand for seed testing and seed processing, a Seed Testing Laboratory has been established at Tadepalligudem and it is expected to start functioning from September 1971. Three seed processing units are being established in Nizamabad, Guntur and Chittoor districts.

To combat the increased incidents of pest attack on crops, particularly, on paddy, ground nut etc., Government undertook large scale control measures during the year. Pest control operations were conducted over an extent of 452,410 acres during 1970-71 involving a subsidy of Rs. 43.8 lakhs to the cultivators. In addition, an extent of over 64,600 acres was twice sprayed aerially to protect crops against paddy blast in Nizamabad district.

In 1970-71, a new scheme for subsidised distribution of mist blowers to those who take to contract spraying as their vocation has been implemented on a trial basis in Krishna, Nizamabad and Kurnool districts and it is proposed to extend it to the other districts of the State during 1971-72.

Soil Testing is receiving increased attention with the expansion of activities under the High Yielding and Multiple Croping Programme in order to enable the proper dosage of fertilisers being recommended for the crops. By the end of 1970-71, one Soil Testing Laboratory has been established in each district excepting in the newly formed district of Ongole.

The Indo-French project for agricultural development in the semi-arid zone of Andhra Pradesh has been located in Ananthapur district. The French Government have offered assistance for three years for schemes involving behavioral trials of new varieties and species with reference to the agro-climatological situation in the area, optimum water requirements of plants and adoption of techniques and equipment for better water utilisation.

During 1970-71, experiments have been conducted in Reddipalli Farm, Ananthapur district to study the effect of scanty rain-fall, economical seed rate, rotation trials, inter-cultivation, green manure trials, effect of chemical fertilisers and short duration crops etc., on dry farming. Besides conducting the trial and demonstration on proved practices, it is proposed to impart training to selected farmers of the district in simple package of practices on cultivation of groundnut and millets.


The Andhra Pradesh State Agro-Industries Corporation has drawn up a programme for distribution of tractors etc., worth Rs. 200 lakhs, drilling operations of 700 tube-wells, land development and other agricultural operations in 20,000 acres and Geological Consultancy Service of 600 points during 1971-72. The Corporation has recently set up consultancy service in food technology and has undertaken a programme for training the cultivators etc., in the use and maintenance of tractors and implements. Additional workshop facilities are planned to be provided with a view to improve after sales services and to undertake manufacture of spares etc. The Corporation has reduced the rates of hire charges of bulldozers suitably and it is expected that the reduction would be of benefit to the agriculturists.

Ground-water exploration.

In response to a demand both in the Legislature and outside for setting up a suitable organisation for investigation and exploitation of ground-water in the State, as also for the purpose of providing technical support for processing and aiding in the implementation of the Area Development Schemes that are being financed with the World Bank Aid, Government have set up a Ground-water directoriate in Feburary 1971. The Directorate has started functioning and has already scrutinised and cleared 34 schemes sent by the Andhra Pradesh Co-operative Central Land Mortgage Bank Limited Regional Offices with necessary technical staff are being started in the districts.

With a grant-in-aid sanctioned by Government, the Osmania University is undertaking investigation of Ground Water Resources of the Musi Project area by Geophysical and Hydro-Geophysical methods in order to help construction of wells in the ayacut.


Stocking of fish seed in inland waters and exploitation of marine fisheries by mechanised craft are prerequisites for development of fisheries. The augment the production of fisheries from the departmental fish farms, which is now only about two crores, pisciculture by ryots and small industrialists is being encouraged by Government for the first time for fully stocking the reservoirs with fish seed in a period of two to three years.

In the field of marine fisheries, Government are assisting in the establishment of fishing and processing industry, which would improve the income of the fisher men considerably while it augments foreign exchange earnings. A beginning has been made by leasing out the shore facilities at Visakapatnam to a reputed firm. The establishment of a six crore Deep-Sea Fishing Project in Andhra Pradesh by a private company is under active consideration. Yet another firm proposes to operate two of its imported trawlers from the Visakapatnam Harbour and to increase the number gradually to twelve in the due course. Other intitutions and persons interested in starting deep-sea fishing industry are being encouraged to operate from Andhra Pradesh.

In order to intensify the mechanised fishing programme Government have taken steps to increase the manufacturing capacity of the Boat Building Yard at Kakinada.

It is proposed to construct nine fishing harbours in the State and as a first step, survey work has been taken up by the U.N.D.P experts on the Narsapur and Nizampatnam harbours. Simultaneously, steps have been taken for the construction of a fishing harbours in Visakapatnam along with the outer harbour.

Animal Husbandry.

The activities of the Animal Husbandry department have been oriented towards increased production. Four more Key Village Blocks were opened at Metpally ( Karimnagar district), Mydukur ( Cuddapah district), Allagadda ( Kurnool district) and Pakala (Chittoor district). All these blocks were established in potential milk-shed areas with a view to convert them later into Intensive Cattle Development Blocks with the other existing Key Village Blocks.

While the Feed Mixing Plants are being worked to capacity with additional shifts, further progress was registered in respect of the fodder development programme as well and about seven thousand acres of extra area was brought under fodder cultivation, both with leguminous and non-leguminous varieties.

With a view to meeting the increasing demand for mutton and wool a Centrally Sponsored Large Scale Sheep Breeding Farm has been established near Hyderabad where Corriedale breed of sheep, besides Nellore and Bellary breeds are being maintained to take up cross-breeding. This will help produce cross-breed rams for distribution in the State for up grading the quality of the local sheep.

Animal Health Programmes received special attention during 1970-71 and a significant step was taken in establishing an Animal Health Centre at Vijayawada in support of cattle development activities. The centre is intended to help the farmers in getting quick diagnosis of diseases and investigation of the several diseases prevailing in the area. The Veterinary Biological Research Institute at Hyderabad has made considerable progress and has achieved self-sufficiency in the matter of production of vaccines. With the help of public contributions, 29 Veterniary Dispensaries have been established under the' Own-your own veterniary dispensary Scheme'. In addition, 15 rural Veterniary Dispensaries were opened involving more than three lakhs of rupees as public contribution. Five Minor Veterniary Dispensaries and 12 Rural Veterniary Dispensaries were opened during 1970-71 in the tribal areas of the State. In the Telangana Region, 12 Rural Veterniary Dispensaries were upgraded to the status of Minor Veterniary Dispensaries. A centre for the control of Liver-Fluke disease was established at Nalgonda with five sub-centres to cover the ayacut area of the left canal under the Nagarjunasagar Project and the Musi Project.

Dairy and Milk Supply.

During the year 1970-71, significant progress has been recorded in all Dairy Development Schemes in the State. The implementation of the Milk Schemes has made a substantial contribution in the improvement of the rural economy specially for the weaker sections and landless poor, while at the same time serving the urban consumers with hygienic milk at reasonable rates. During 1970-71, the total quantity of Milk procured by the Integrated Milk Project ( Hyderabad-Vijayawada) was of the order of 382.80 lakh litres as against 276.23 lakh litres during 1969-70. The sale of milk at Hyderabad and Vijayawada was of the order of 368.60 lakh litres as against 249.32 lakh litres during 1969-70. Further the maximum procurement per day during the flush of 1970-71 was 1,55,000 litres compared to the 1,20,000 litres during the corresponding flush season of 1969-70.

In Telangana area, the Chilling Centre at Bhongir was completed and was commissioned. In addition, the Milk Cooling Centres at Nizamabad, Karimnagar and Chityal were also completed and commissioned. The work in respect of Chilling Centres at Kadthal, Nizamabad, Suryapet, Gajwal and Zaheerabad are in good progress. The work on the Cooling Centres at Mahaboobnagar, Kalwakurthy, Pargi, Nizamabad, Alair, Mulug and Warangal is nearing completion. In order to provide proper handling facilities for the milk that will be received from the above Chilling and Cooling Centres, the Central Dairy, Hyderabad has been strengthened adequately with the addition of storage tanks, second bottling line, road tankers etc.

In Andhra area, during 1970-71 the Chilling Centres at an Angalakuddur, Kolluru and Returu have been commissioned and the work at the Chilling Centres Tiruvur, Bhimavaram, Narasaraopet and Chillakallu are in good progress. Milk Cooling Centres at Ramabhadrapurum and Srikakulam have also been commissioned.

In Rayalseema area, the Mydukur Cooling Centre in Cuddapah district has been commissioned and the progress of work at Kurnool Dairy and Ananthapur Milk Cooling Centre is satisfactory.

At present 80,000 families in the twin cities are being supplied hygienic bottled milk. In addition, 4,000 low-income-group families are provided with toned milk under UNICEF subsidised programme. Under the'CARE' programme 171 schools involving 30,000 school children are being supplied with milk daily. In addition, the programme to cover the vulnerable group of children aged between 0 to 3 years has been taken up in the twin cities through the Child Welfare Centres.

Under the Operation Flood Programme, financial assistance to the tune of Rs. 13.12 lakhs was received during 1970-71. It is expected that during the current year financial assistance of Rs. 50 lakhs will be received out of the total provision of Rs. 2.46 crores promised to Andhra Pradesh. With the help of this assistance from Indian Dairy Corporation, Government propose to strengthen the daries and Chilling Centres and accelerate the Intensive Cattle Development Programmes.

With the object of helping weaker sections, specially the agricultural labourers and small farmers, 100 Milk Co-operative Societies have been organised. Each Society consists of landless labourers and small farmers having two acres of land and less, and each of them will be eligible for a loan of Rs. 1,000 for the purchase of milch animals. For financing these by the District Co-operative Central Banks, Government stood guarantee for a loan of Rs. 50 lakhs to the State Apex Co-operative Bank.

The Integrated Milk Project has expanded considerably during the last two years. With a view to ensure administrative and operational flexibility and to secure larger financial resources outside the present limited budgetary provision, Government have decided to constitute a corporation in the place of the departmentally administered Milk Project and for transfering the responsibilities of the Integrated Milk Project to it. It has been decided to register the Andhra Pradesh Dairy Corporation Limited, under the Indian Companies act, 1956. The Corporation will be a wholly-owned Government concern.


During the year 1970-71, the co-operatives disbursed short term credit of the order of Rs. 24.35 crores. The target fixed for 1971-72 is Rs. 44 crores. In respect of long term credit, a total amount of Rs. 19.77 crores was distributed by the Land Mortgage Banks in 1970-71.

The World Bank has sanctioned an Agricultural Credit Project involving an outlay of Rs. 31.10 crores for implementation in the state. The loaning programme, excluding the investment to be met by the farmers from their own resources, is Rs. 26.44 crores and the World Bank has agreed to provide Rs. 18.30 crores for this purpose. The A.P Co-operative Central Land Mortgage Bank is principal agency for providing credit for the farmers of the Project. The Agricultural Refinance Corporation will provide 90% of the financial outlay in respect of Minor Irrigation schemes and 75% in respect of land development and tractor schemes, while the balance will be provided by the Government of Andhra Pradesh. A physical programme of sinking 1,350 tube-wells, 14,000 dug-wells, development of 5,000 wells, installation of 7,700 oil engines and 12,000 electric motors, development of 1,36,300 acres in Nagarjunasagar and Pochampad projects and under the new wells and the supply of 1,500 tractors have been approved under the Project. The Project is expected to benefit 45,000 farmers all over the State, the Minor Irrigation programme itself covering as many as 78 taluks. Concessional period of repayment has been provided for inrespect of small farmers.

While a reference to co-operative Housing and Co-operatives for weaker sections of the society has been made separately, I would to invite the attention of this Honourable House to a special programme introduced during the year-the Group Insurance Scheme. Four catogeries of schemes have been drawn up in collaboration with the Life Insurance Corporation of India- (i) Group Insurance scheme for the borrowers from the Andhra Pradesh State Housing Federation, (ii) Compulsory Mortgage Redemption insurance for the members of Taxi and Auto-rickshaw Co-operative Societies, (iii) Compulsory Group gratuity-cum-Life Insurance scheme for employees in the Co-operative Sector and (iv) Voluntary Mortgage Redumption in the insurance scheme for the borrowers from the A.P State Co-operative Land Mortgage Bank. It is envisaged that these schemes will provide the much needed social security to the members and employees of the co-operatives.

Another important development during the year is the amendment to the Co-operative Societies Act designed to Curb the vested interests in the Co-operatives and to enable the Co-operatives to help the small farmers. Among other things, the amended Act empowers the Government to earmark a definite portion of the total borrowing is of the society towards the disbursment to small farmers. The House, I am sure, will appreciate that this is a bold and forward step in the development of the cooperative movement in the state.


In respect of Nagarjunasagar project, all works necessary for letting out water in the first 57 miles of the right main canal and in the branches and distributaries in the Blocks 1 to 10 and part of block 11 have been completed. During 1971, additional irrigational potential for 23,000 acres has been programmed to be created under the right canal bringing the total to 7. 38 lakh acres, against the estimated ayacut of 11. 74 lakh acres. On the left main canal, works necessary for letting out water in the first 72 miles and in the branches and distributaries in blocks 1 to 12 and part of block 13 have been completed. During the year 1971, additional irrigation potential for 32,000 acres is likely to be created bringing the total to 2. 83 lakh acres against the total ayacut of 8. 8 lakh acres under the left canal. A total expenditure of Rs. 170. 66 crores has been incurred on the project since its commencement. The budget provision for 1971- 72 for Nagarjunasagar project is Rs. 10. 62 crores- Rs. 87 lakhs for the dam, Rs. 475 lakhs for the right canal and Rs. 500 lakhs for the left canal.

The work on the Pochampad Project is making good progress. On the main canal, excavation in the first stretch of 22 miles has been completed. The project has been posed for assistance from the World Bank by the Government of India and negotiations with the IDA were held in Washington during May, 1971. The draft agreement in respect of this assistance is under finalisation. The expenditure on the project since inception up to March, 1971 is Rs. 26.90 crores. The provision for 1971- 72 is Rs. 9.32 crores, Rs. 6 crores from the normal plan, and another Rs. 3. 32 crores to be found from Telangana Surplus and additional assistance from the Government of India.

The excavation of foundations and preliminary works on the Vamsadhara project have been taken up. Two divisions have been formed at Srikakulam and Hiramandalam for attending to the investigation and execution of the project. The expenditure incurred in 1970- 71 was Rs. 51 lakhs, as against the provision of Rs. 50 lakhs. As amount of Rs. 100 lakhs has been provided for this project during 1971- 72.

The first stage of Somashila project has been notified for advance betterment levy. Detailed investigation for the inclusion of the backward tracts of Nellore district within the scope of project has been taken up.

A provision of Rs. 25 lakhs has been made in the Budget for Pulivendla scheme. Steps are being taken for the execution of the Anicut on Chitravathi which is a part of the Pulivendla canal system.

Krishna- Godavari delta drainage scheme has made further progress during 1970- 71. Drainage cess to the extent of Rs. 80 lakhs has been collected. The Life Insurance Corporation has been approached for assistance towards this scheme and it is expected that a loan of Rs. 2 crores will be sanctioned by them. The expenditure incurred so far on the scheme being Rs.8.75 crores.


The present installed capacity in the State is about 610 MW. In the context of the rising power demand, efforts are being made to commission new power units as early as possible. It is proposed to commission Ramagundam"B" Station with a capacity of 62.5 MW in August- September 1971. With this addition, the installed capacity in the State will be increased to 672. 5 MW. It is he is maintained that by the end of the Fourth Five-Year Plan the peak load demand will reach 1,087 MW., the installed capacity reaching only 958 MW., and thus the State will be facing a shortage of power towards the end of the Fourth Plan period. The State Government have already impressed on the Government of India the need for the establishment of a Nuclear Power Station at Somashila and for getting a share from the Central Generating Stations such as Neyveli and Kalpakkam in Tamilnadu. The Government of India have decided to distributed 50% of the output from the second unit of the Kalpakkam atomic station in Tamilnadu to Andhra Pradesh, Kerala and Mysore.

In spite of the problems arising from limitations of financial resources, a total of 974 villages- 301 villages in coastal Andhra, 248 villages in Rayalaseema and 425 villages in Telangana were electrified by the State Government in 1970- 71. The number of agricultural pump-sets energised in the State during 1970- 71 was 30,534. During the year 1971- 72, the State Electricity Board has a programme to electrify 1,000 villages and connect more than 1-lakh services. Eleven cluster schemes costing about seven crores have been approved for execution in Andhra Pradesh with financial assistance from the Rural Electrification Corporation. The programme of electrification of 173 villages in Sircilla Taluk of Karimnagar district through the agency of Rural Electrification Cooperative has made substantial progress.

As regards Srisailam project, it has been programmed to raise the dam to an average height of plus 550 in the spillway portion in 1971- 72. The expenditure incurred on the civil works of the project up to the end of May 1971 is Rs. 29.33 crores. The provision for 1971- 72 is Rs. 4.20 crores.


Largely due to the agriculture oriented economy of the State, Andhra Pradesh has been a somewhat late entrant in the field of industrialisation. However, during the last decade, there has been a steady growth of a wide range of industries including engineering units, fertilisers and chemical factories. There has also been a sizable growth of small industrial units, particularly the industrial estates spread throughout the State. This momentum in industrial growth was well sustained during the past year.

As the House is aware, the work on the Steel Plant at Visakapatnam was inaugurated early this year by the Prime Minister. The establishment of the steel plant will mark the fulfilment of one of the cherished dreams of the people of the State and its effects on the economy of the entire State will be of immense significance. Another important Central sector project in which a beginning has been made is the coal- based fertilizer plant at Ramagundam in Karimnagar District. A telecommunication cable factory is being set-up by the Hindustan Cables at a cost of about Rs. 10 crores at Hyderabad. The Government of India have also approved the setting up of a Zinc Smelter plant at Visakapatnam at a cost of about Rs. 22 crores. Another Central Sector project that is being set-up in Hyderabad is the Bharat Dynamics. An outer harbour at Visakapatnam at a cost of Rs. 37 crores is also to be undertaken by the Central Government. The Rocket launching station at Sriharikota in Nellore District has made further progress during the year, and it is hoped that this would contribute to the expansion of the scope for employment in and around the area. The State Government are continuing their efforts to secure the location of a large number of Central projects in Andhra Pradesh.

The Government are deeply conscious of the crucial role of industrialization in the creation of opportunities for employment, particularly for the educated unemployed. A Technocrat Industrial Estate and a scheme of Artisan Guild have been taken up for implementation recently. It has been decided to channel a large part of industrial development in Andhra Pradesh into cities and towns outside Hyderabad- Secunderabad and Visakapatnam, so that the fruits of industrialization are more widely distributed and more equitably shared among the people.

The Andhra Pradesh State Industrial Development Corporation has obtained letters of intent for the setting up of a Scooter project, the manufacture of Automobile tubes and tyres and a scheme for manufacturing of a wide range of electronic components. The Corporation has also applied for the license for a nylon yarn project and a continuous casting plant. The tyres and tubes unit is likely to be located at Mangalagiri in Guntur district and the nylon yarn project in Renigunta- Tirupathi area in Rayalaseema. It is also envisaged that a sponge iron plant may be established in Kothagudem area.

In the Small Scale sector, the Andhra Pradesh Small Scale Industrial Development Corporation has promoted and assisted the establishment of 63 units by unemployed technocrats during the past one year. The Corporation has also promoted 20 joint ventures in different parts of the State. Consistent with the policy of according overriding importance to the creation of employment opportunities, Government have recently directed the Small Scale Industrial Development Corporation to concentrate their efforts on industries will maximize employment opportunities, particularly among the educated unemployed and weaker sections of the society, such as Scheduled Castes and Scheduled Tribes. It is also proposed to place special emphasis on the industries based on forest produce, in view of their significance to the Scheduled Tribes.

The preparation of district plans for the establishment of a number of small scale industrial units and medium industries in each district has also been undertaken recently. The plans are intended to be of assistance not only in attracting industries from outside but in providing guidance to local entrepreneurs as well.

The Andhra Pradesh State Financial Corporation has been extending financial assistance to new and existing industrial units and the total loans sanctioned so far is of the order of Rs. 19.36 crores. During 1970-71, the Corporation sanctioned loans amounting to Rs. 3.58 crores, covering 294 units and generating an employment potential for 4,700. In order to work out a concerted plan for the promotion of industries in the State and take necessary measures towards that end, an Inter- institutional Coordination Committee of all major financial institutions and the promotional Corporations has been set-up with representatives from the Industrial Development Bank of India, the Industrial Financial Corporation, the State Industrial Corporation, and the State Government. It is a good augury that the Industrial Development of Bank of India has also opened a branch at Hyderabad, thus improving the access to the institutional financial institutions to the local entrepreneurs.

The difficulties faced by the Textile Industry which supports a large number of workers have engaged the special attention of the Government during the year. The as Azamjahi Mill has been recently taken over by National Textile Corporation, at the request of the State Government, in order to enable its modernisation and smooth functioning. Efforts are being made to revive the Netha a Cooperative Spinning Mills and to reopen the textile mills in the private sector which have been closed down. In order to meet the problem of cotton shortage faced by the textile as well as handloom sector, the State Government have initiated a programme of growing cotton in association with the spinning mills and with the co-operation of the banks.

Steps are being taken to rehabilitate other industrial undertaking is and ensure their working on efficient lines. The Hyderabad Allwyn Metal Works, the management of which was taken over by the Government in August 1969 is well on the road to recovery. The performances of this concern and the continued good working of the Nizam Sugar Factory would indeed show the inherent potentialities of the public sector. Suitable measures are also being taken to bring about improvements in the working of the Hyderabad Chemicals and Fertilisers, the Singareni Collieries and the Sirsilk. It is also hoped that the Andhra Scientific Company, Masulipatnam will be taken over by the Government of India.

In the Cooperative sector, letters of intent have been obtained for the establishment of four new Cooperative Sugar Factories to be located in Cuddapah, Guntur, Nalgonda and Srikakulam districts.

In the Private sector, letters of intent have been received for fifty Industrial undertakings. Important among these is a Horlicks factory to be set-up in east Godavari district. The Government have advised the management of this concern to accord suitable priority to the members of the Scheduled Castes and Scheduled Tribes, the poor and the small ryots in the provision of loan assistance for the purchase of milch cattle. Amongst other units recently licensed are a Typewriter factory at Hyderabad, a Scooter plant in Vijayawada, a Vegetable and Fruit factory at Medak and an Electrical stamping unit at Hyderabad. Fifty seven more applications for the grant of license or letters of intent for new units and for new lines of manufacture by existing units have been recommended to the Government of India including the setting up of four jute mills and an unit of Hindustan Levers for the manufacture of detergents and semi- processed material for soap-making.

In the field of mineral development, various steps are being taken to ensure the full utilisation of the mineral resources, particularly in backward areas. It is hoped that the Ramagiri Gold Mines will be taken over for exploitation by the Kolar Gold Mines Undertaking. The question of intensification of the work in respect of Ramallakota and Vajrakarur diamond deposits has also been taken up with the Government of India.

Government attach increasing importance to the rapid industrialization of the State. It is proposed to intensify these efforts in the coming year, in order to provide larger employment opportunities and a wider diffusion of the benefits of industrialisation over larger sections of the community.

I would, in this context, emphasis the important roll which the institutional financing agencies and promotional institutions have to play in a developing economy. With the existing social and economic inequalities, it is necessary that these institutions have new orientation and outlook and keep themselves informed of the objectives of the social and economic policies pursued by the State in determining their pattern of lending and in selecting the areas of emphasis. In the field of industries, as well as in agriculture, it should be the endeavour of the institutional agencies to go to the help of the small artisan, self employed persons and the unemployed. It is proposed to convene a meeting of the bankers shortly to discuss the relevant issues and to draw up clear- cut lines of action.


The question of improving the standards of education and avoiding wastage at all levels has been reviewed by the Government recently. It has been recognised that as a result of annual detentions in all classes, there is large scale stagnation and wastage, particularly in the primary and upper- primary sections. It has therefore been considered that it is not necessary that students should be subjected to a formal examination at every class. Taking all these factors into consideration, it has been decided that from the year 1971, there should be no detention of students at the end of any class, except at the stages where they have to take a common examination at the district or State level, viz., in the seventh class and the tenth class. It is expected that this decision which is based on sound educational consideration is will be of immense benefit to the students, particularly those belonging to backward regions. At the same time, an effective system of assessment in the form of frequent tests is being evolved. It is also envisaged that greater emphasis should be placed on regular and larger percentage of attendance than at present. This represents an important change in the educational policy of the State Government and may be forerunner of similar reforms in other states as well.

It has also been decided to introduce Telugu as medium instruction in the degree courses from the academic year 1971-72, with English as an alternative medium of instruction. In Osmania University area, the existing facilities with regard to Hindi and Urdu Medium will continue at the degree level. Government have under consideration various measures to better the prospects of recruitment to services within the State for those qualifying under Telugu Medium. Reading material in the form of reference books for the degree course in Telugu are under preparation by the Telugu Academy.

Welfare of weaker sections.

The House is aware of the importance attached by the Government in recent years to the various measures for promoting the development of Scheduled Tribes, Scheduled Castes and other weaker sections of the Society.

The year 1970- 71 saw a large increase in the Budget allocation for the welfare of Scheduled Tribes and Scheduled Castes. Indeed, the year marked the beginning of the implementation of the special tribal plan within an outlay of Rs. 1. 60 crores as a part of Rs. 10 crore special Plan to be implemented over a period of four years. This comprehensive development programme envisages a variety of programmes including intensive agricultural efforts, extension of electricity, improvement of communications, establishment of mobile medical units, setting up of residential schools, etc. The performances in 1970-71 was creditable, judged in relation to the factory that this was the first year of implementation of the programme. The Special Plan is being continued in the current year with increased emphasis. In addition, a composite tribal development project for Srikakulam district with an outlay of Rs. 1.50 crores has been formulated and sent to Government of India for financial assistance.

Another notable feature is the effective implementation of the protective legislation for the Scheduled areas. Various protective measures including the Land Transfer Regulation which prohibits the alienation of land to non- trebles; the Debt Relief Regulation under which the existing debts have been scaled down to the level of the principal; estinguishing the interest element altogether and providing for a moratorium of two years on the repayment of the scaled down debts; the abolition of the Muttadari system; the regulation of money lending in tribal areas etc; have been implemented with a special emphasis, with the assistance of staff exclusively charged with this task. The enactment of similar protective legislation for Scheduled Tribes outside the Scheduled areas as recommended by the Dhebar Commission is under the active consideration of the Government. The amendment to the Land Transfer Regulation to the permit the mortgage of the lands in favour of Cooperative Societies and Commercial Banks is awaiting the approval of the President.

Honourable Members may recall the reference made in the last year's budget and the interim budget of the expansion and the intensification of the activities of the Girijan Cooperative Corporation. It has been recognised by the Government that so far as the schedule tribes are concerned, the Girijan corporation which has one the confidence of the Girijans is the most appropriate institution that should form the focal point in the development of the Girijan areas. The expanded activities of the Corporation envisage not only the purchase of minor forest produce from the Scheduled Tribes, but the supply of daily domestic requirements through a network of depots all over the tribal areas both in the Scheduled areas and outside, the distribution of short- term credit and medium term loans and the taking up of other allied activities to promote the welfare of Scheduled Tribes.

An important development during the year is the review of the pricing policy adopted by the Corporation. In recognition of the need to pay a fair price to the Girijans for the forest produce delivered by them to the Corporation, it has been decided that the Corporation should pay a much higher price than in the past, the losses, if any incurred by the Corporation being subsidized by the Government. This liberal policy is intended to provide a larger volume of income to the trebles and to ensure that there is a progressive improvement in the economic conditions of the trebles. The turn- over of the Corporation during the current year is expected to touch Rs. 2 crores representing a 100% increase over the previous year. The Revolving Fund scheme initiated in 1970-71 for extending short-term credit to the Scheduled Tribes has made further headway during the year. The short-term credit limit of Rs. 25 lakhs provided by the Reserve Bank of India has also been fully utilised. Simultaneously, steps have been taken to revitalise and strengthen cooperative credit structure so that they may function effectively as agencies of credit for tribal agriculturists. The diversification and expansion in the activities of the Girijan Corporation and the implementation of a large scale programme of development of the tribal areas and indicative of the earnestness of the State Government in fulfilling its commitments to this long neglected Sections of the society. In this connection, may also refer to the factory that the Government have undertaken to guarantee all the loans provided by the Land Mortgage Banks to the Harijans and Scheduled Tribes in respect of inalienable lands held by them.

Honourable Members are already aware of the large scale housing programme that has been proposed to be undertaken for the benefit of Scheduled Castes and Scheduled Tribes. Government have already provided Rs.93 lakhs to the Scheduled Castes and Scheduled Tribes Housing Corporation and have Sought financial assistance from the Life Insurance Corporation. I am happy to announce that as a result of the personal efforts of our Chief Minister, the Life Insurance Corporation have agreed to sanction Rs. 10 crores during this year for this purpose. I take this opportunity to thank the Life Insurance Corporation, in particular, the Chairman Shri Pai for this excellent gesture towards the weaker sections of the population of our State.

No scheme of welfare for the Scheduled Castes or Scheduled Tribes can be considered adequate in the present socio-economic situation, unless it is based on a definite programme of distribution of Government lands and the redistribution of the surplus lands taken over under the Land Legislation’s. Under the programme of assignment of land, more than 24 lakh acres of land have been distributed to the landless poor persons including Harijan and Girijans. In order to make additional lands available, disreservation of forest was also taken up recently releasing 1.28 lakh acres for distribution. I may also mention that it is an integral part of the crash programme of assignment that rich landed persons who have encroached on Government lands should be evicted to make the lands available for the landless poor. Government have directed that the surplus lands available under Land Ceilings legislation and the Government lands under unauthorized occupation of ineligible persons should be taken over with utmost expedition and the programme of distribution of lands to landless poor should be completed before the end of March, 1972.

Government also recognise that mere provision of land without provision of in-puts would be incomplete as a measure of real relief to the weaker sections. In order, therefore, to provide adequate credit in favour of assignees to enable them to reclaim the land and to meet the expenses of cultivation, the Cooperative Credit Societies Act has been amended, as stated earlier, empowering the Government to identify a fixed percentage of total credit advanced by the primaries to be earmarked for the small farmer. It is proposed to set apart as much as 90% of the total credit for the small farmers.

A special effort is also being made to identify certain categories of occupational groups for the purpose of rendering assistance through the Cooperative Department. A Taxi-Drivers Cooperative Society has been set-up during the year to assist Taxi- Drivers to become members by providing vehicles on hire purchase basis with an initial contribution as low as 5% of the cost of the vehicle. Similar Cooperative Societies have been set-up for Auto- rickshaw drivers. Weavers Cooperative consisting exclusively of Scheduled Tribes and Scheduled Castes is are also proposed to be started.

A crash programme of assignment of house- sites has been introduced recently to enable the quick acquisition of land for the purpose is of house- sites. Government have also taken a firm policy decision to extend the benefits of electricity to Harijan localities in every village. Certain other measures such as leasing out of lands of various institutions to the landless poor on a preferential basis, supply of milch cattle for Scheduled Castes, provision of interest free loans etc, are also proposed to be included in the programme for the current year.

Housing, Water Supply and Urban Development.

In order to intensify housing activity in both urban and rural areas, specially for the weaker sections of the community and low-income groups and also to create employment potential, the Government of India have introduced a Revolving Fund Scheme. We have formulated fifteen schemes initially for being financed from the Revolving Fund and the approval of the Government of India is awaited. The Apex Cooperative Housing Federation which was activised last year with a Share capital contribution of Rs. 8. 75 lakhs has successfully negotiated a loan of Rs. 75 lakhs from the Life Insurance Corporation. It is also proposed to formulate, in consultation with the Life Insurance Corporation, the construction of multi-storeyed flats to be soled on hire purchase basis on the lines of similar schemes financed by them in Bombay. Steps have been taken to approach the Government of India for financial assistance for the village housing schemes. A Development Authority for the twin cities is also to be set-up on the lines of the Delhi Development Authority.

Government are fully alive to the need for providing drinking water facilities particularly in rural areas. The work in this respect has been taken up under a variety of programmes-including construction of draw-wells, bore-wells with the assistance of the UNICEF rigs in the hard core areas of chronically drought-affected regions of Rayalaseema and Telangana and Piped water supply schemes. For the year 1971-72, a total amount of Rs. 91.5 lakhs has been provided both under Plan and non-plan for the construction of wells.

With the help of rigs provided by the UNICEF, considerable headway has been made in respect of rural water supply in the drought- affected areas of Rayalaseema and Telangana. 807 bore wells and have been completed in Anantapur district. According to the programme drawn up, the rigs are being employed for the completing 500 bore wells in Kurnool district, 655 in Nalgonda district and 420 in Cuddapah district. Fifteen more rigs are expected from UNICEF and these are proposed to be employed in hard-core areas in Chittoor, Guntur, Hyderabad, Mahaboobnagar, Ongole and Nellore districts during the coming years. A provision of Rs.47 lakhs has also been made for protected water supply schemes during the year 1971- 72. In addition, an amount of Rs. 90 lakhs has also been made from the Telangana funds for completing the protected water supply schemes in 58 former Town Committees of Telangana region. It is also proposed to take up a large number of protective water supply schemes with the financial assistance from the Life Insurance Corporation of India. Instructions have been issued to accord high priority for Harijan and Scheduled Tribes localities.

The High Power Committee on Municipal Finances is expected to submit its report before the end of August. A provision of Rs. 1 crore has been made in the budget for the implementation of the recommendation of the Committee and it is hoped that it should be possible to strengthen the finances of the Municipal bodies in the State to enable them to function more effectively in the field of urban development.

Special Schemes for small farmers, marginal farmers and Drought-affected areas.

Recognising the fact that the flow of credit to the small farmer has been inadequate and realising the need for increasing the responsiveness of the credit institutions to the this category of cultivator, Small Farmers Development Agency scheme has been introduced in Srikakulam, Cuddapah and Nalgonda districts. The Small Farmer Development Agencies are intended to catalyze the flow of credit to about 50,000 small farmers in each area in order to enable them to undertake intensive programmes of development. Government of India have released the first installment of funds and necessary steps have been taken by the State Government to strengthen the cooperative structure in these districts. These projects are in initial stages of implementation and the progress is being constantly reviewed both by the Government of India and the State Government. There is know doubt that the successful implementation of these projects will go a long way to ensure that the benefits of the institutional credit flow to a much neglected but more deserving sections of the farming community.

Another programme to assist the marginal cultivators in maximising the productive use of the small holdings and also to help the landless agriculturists, known as the Marginal Farmers and Agricultural Labourers Scheme, is under implementation in Nalgonda and Visakapatnam districts. The scheme covers about 20,000 marginal farmers and agricultural labourers in each area and envisages the channelling of credit, provision of improved in-puts and creation of employment opportunities through such works as may help in the maximum exploitation of the agricultural potentialities in the area. Provision has also been made in these schemes for the development of rural artisans.

The Rural Works Programme, the execution of which was commenced last year in Mahaboobnagar, Kurnool, Anantapur, Cuddapah and Chittoor districts has made substantial progress, the expenditure reaching Rs. 187. 90 lakhs in the first year of its implementation. The State Government's request for the inclusion of Nalgonda and Ongole districts in the coverage of the programme is still under the consideration of the Government of India. The programme aims at the creation of permanent assets while providing employment to the agricultural labour in these districts, as a part of the larger efforts to change the landscape of the chronically drought-affected areas in the country. The significance of the programme lies not merely in the idea of a programme for the drought-affected areas, but in the direction and purposiveness of the effort involved in the programme. The programme is being continued in the current year and the expenditure envisaged is Rs. 4.40 crores.

The House will appreciate that these schemes represent a new beginning, a beginning of a new category of schemes with a rural bias and oriented towards employment. It is hoped that the coverage of these schemes in our State would be expanded in the coming years and it would be possible to confer substantial benefits on the small, marginal and landless agriculturists.

Annual plan.

The final size of the Fourth Five-Year Plan for the State has not yet been determined and as indicated last year, the Annual Plans are being formulated with reference to the general directions of development envisaged in the draft Fourth Plan. The revised outlay on the State's Annual Plan for 1970- 71 was Rs. 86.68 crores Rs. 35.35 crores for coastal Andhra, Rs. 17. 62 crores for Rayalaseema and Rs.33.71 crores for Telangana. This excludes the funds provided for special Telangana development schemes.

For the year 1971-72, a Plan of Rs. 105.58 crores was prepared and included in the" Vote on Account" budget. In the final budget now presented, only a minor modification has been made in that the outlay of Rs. 50 lakhs earlier included towards Krishna- Godavari Delta Drainage Scheme has now been transferred to the non-Plan side as it is to be financed by the drainage cess collections.

For the year 1972-72, certain broad principles allocation of the Plan funds to Telangana region have been evolved in the light of the Prime Minister's Review Committee meeting and the subsequent discussions with the Union Minister of Planning. The special provision of Rs. 10 crores for backward areas out of the total of Rs. 105.08 crores in the Plan of 1971-72, has been divided between Telangana, Rayalaseema and Coastal Andhra in the ratio of 5:3:2. The balance of the Plan outlay has been distributed between the three regions on the basis of the population according to the 1971 census. Thus the total regionwise break up of the Plan works out to Rs.43.60 crores for Coastal Andhra Rs. 22.25 crores for Rayalaseema and Rs. 39.23 crores for Telangana.

A substantial part of the Plan outlay, almost two-thirds is intended towards investment in Irrigation and Power sectors. As indicated earlier, the allocations for the Nagarjunasagar is Rs. 10. 62 crores and for Pochampad Rs. 9. 32 crores of which Rs. 6 crores will come from normal Plan and Rs. 3. 32 crores from the Telangana surpluses and special assistance from the Government of India. The allocation for Vamsadhara is Rs. 1 crore and Tungabadra High-Level Canal Rs.2 crores. The allocation for all other medium and major schemes put together has been increased from Rs. 5.39 crores in 1970-71 to Rs. 7.28 crores in 1971-72. The allocation for Power has been enhanced from the Rs. 36.52 crores in 1970-71 to Rs. 42.11 crores in 1971-72, the largest commitment being Rs.12.82 crores for Kothagudem Stage III and Rs. 5.78 crores for Lower Sileru. The allocation for Education has been increased from Rs. 2.47 crores to Rs. 3.59 crores and for welfare of backward classes from Rs. 1.49 crores to Rs. 2.10 crores. In addition, a sum of Rs. 1 crore has been provided for the Scheduled Castes is and Scheduled Tribes Housing Federation out of the special allotments for the three regions.

The House may recall that an amount of Rs. 9 crores was allotted for Special Telangana Development Schemes in 1970- 71. In addition, an amount 6. 12 lakhs representing unspent balances of 1969-70 were also sanctioned. Further, the Government of India sanctioned special assistance of Rs. 2 crores for Pochampad project, of which Rs. 1 crore was to be met from Telangana surpluses. The total allotment for Special Telangana Development Schemes in 1970-71 was thus Rs. 10.06 crores. For the year 1971-72, Rs.9 crores have been provided for Special Telangana schemes. A part of the additional allotment of Rs.3.32 crores to Pochampad will also be drawn from Telangana surpluses.

It would be useful in this context to refer to the efforts made by the State Government to secure a balanced development of different regions of the State. Uneven economic development and inter-regional imbalances are but one facet of the socio- economic inequalities which characterise the economy of the less- developed nations. Our experiments in the State in respect of regional economic development are perhaps unique in this country. The preparation of a comprehensive and integrated long range Plan for Telangana has been undertaken, with reference to the existing levels of development, the potentialities and the special problems of the region. A Technical Committee has been constituted to render advise to the Government on the preparation of the perfective Plan. The Planning and Development Board for Rayalaseema is formulating a well-defined strategy for the development of the Rayalaseema Region on the basis of a close study of the resources of the region and identification of the problems. Certain guide-lines have been evolved as a result of the discussions at a Seminar convened by the Board. Detailed field studies have been also been conducted in respect of the availability of social services, trends in cropping pattern, assessment of irrigation potential and ground-water resources, the infra-structural facilities needed for accelerated development, identification of growth centres with potential for quick and rapid industrialisation and similar factors. A long term Master Plan indicating the investment needs and areas of growth is under preparation. A perspective Plan for the Coastal areas is also under preparation.

I wish to emphasis, at this stage that the Government attach high priority to the creation of employment opportunities to large number of people. The sizable step up in the Plan outlay is itself directed towards increasing the employment opportunities, as employment is only one of the many aspects of the larger problem of planned development. As indicated earlier, a definite policy decision has been taken by the Government to adopt the criterion of maximising of employment opportunities as the crucial determinant for taking investment decisions in respect of small industries. The Technocrats Industrial Estates and Artisans Guilds, already referred to, are steps towards securing employment for these categories of persons. The Rural Works Programme and similar special programmes are also designed to widen the employment opportunities in the rural areas. The Crash Programme of employment sponsored by the Government of India assuring continues employment to not less than 1,000 persons in each district with an estimated expenditure of Rs. 12.5 lakhs is being put into operation shortly. The Agro-Industries Corporation has introduced a scheme for providing employment to the unemployed technical personnel through Agro-services Centres. A Rs. 25 crore scheme for creating employment for the educated unemployed has also been formulated by the Government of India and we are taking steps for its immediate implementation. In addition to increasing the employment opportunities, an equitable distribution of the available opportunities is also being aimed at through the scheme of providing at least one job for one family introduced recently in Hyderabad city. Various other measures including the absorption of a large number of unemployed technical personnel as apprentices in the Central, State and private sectors units, organising the unemployed engineers and rural unemployed as agencies for the implementation of a variety of programmes under execution in the different districts of the State etc., are under examination. I may assure the House that we shall not spare any efforts in securing gainful employment to the people of our State.

I should also assure the House that the Government are conscious of the need to keep the prices of essential commodities under strict control. No doubt, the maintenance of price stability has to be looked at as a national problem, requiring appropriate monetary and fiscal policies on an All-India level. The extension of Consumer Co-operatives including Super- bazaars and departmental stores is one of the measures intended to hold the price line in respect of consumer goods. In respect of food-grains, a close and careful watch is being kept over the availability of food- grains at reasonable prices. The recent ban on the export of foodgrains from the delta districts of Krishna and West Godavari districts is also directed towards this end.

Budget Estimates 1971-72.

Before proceeding to the financial transaction of the year, I May draw the attention of the House to the fact that as already stated in the Interim Budget, we have, in terms of the Presidential Order, indicated separately the details of receipts and expenditure in relation to Telangana region and the rest of the State, based on the principles of allocation recommended by the Bhargava Committee.

The financial results in respect of 1969-70 and 1970-71 have already been indicated in the Interim Budget and I do not, therefore, propose to repeat them. I shall briefly summarize the results of the financial transactions for the year 1971-72.

The revenue receipts have now been placed at Rs. 319.65 crores, indicating an increase of Rs. 9.61 crores over the" Vote on Account" Budget. The revenue expenditure now stands at Rs.305. 87 crores representing an increase of Rs. 5.73 crores over the" Vote on Account" Budget. The revenue account will thus show an overall surplus of Rs. 13.78 crores.

In respect of Capital Account, the expenditure is now expected to be Rs. 52.28 crores. Taking the Public Debt, Loans and Advances and Public Account together, the transactions of the year are expected to leave an over all deficit of Rs. 9.59 crores.

The year 1971-72 opened with a over-draft of Rs. 47.34 crores. In view of the deficit as a result of the financial transactions during the year, the year is expected to close with an over all deficit of Rs. 56. 93 crores.

A large part of the negative closing balance is the result of the deficit that has been carried over from the previous years. The measures of additional revenues proposed to be undertaken may reduce the over- draft to some extent.

Additional Resources Mobilisation.

The Budget leaves a very large deficit and it is therefore our responsibility to explore the avenues of additional resources mobilisation to make up at least a part of the deficit and to create a wider base of resources for the coming years. I, therefore, propose to outline certain measures, some of which have already been implemented, and some yet to be taken up.

As the House is aware, a notification has been issued recently increasing the rate of quarterly tax on contract carriages under the Andhra Pradesh Motor Vehicles Taxation Act, 1963 from the present rate of Rs.20 to Rs.! 60. This is expected to result in additional revenues of the order of Rs. 55 lakhs in a full year and Rs. 42 lakhs in the current financial year.

The House is also aware of the fact that we had requested the National Council of Applied Economic Research headed by Sri S. Bhootalingam to examine the Sales Tax structure in the State. The report has been received recently and is under examination. It is proposed to bring in suitable modifications in the Sales Tax structure and it is our hope that it will be possibly for us to realise additional revenues by adopting appropriate methods of rationalisation.

Another measures that is proposed to be undertaken relates to Stamp Duty. It is well-known that under valuation of property has been one of the common means to evade Stamp duty. I am sure that the House will appreciate any measures which would put down this evil and enable us to secure adequate revenues at the existing rates of Stamp duty. It is therefore proposed that the rate of Stamp duty should be related to the market value of the property irrespective of the value that may be stated by the parties in the uploads. For this purpose, a Bill has been introduced already before the House to amend the Stamp Act. This measure is expected to result in an additional revenue of about Rs. 1.5 crores per annum.

It may also be recalled that in April this year, an amendment was introduced to the Motor Vehicles Taxation Act to levy a surcharge on the motor vehicles tax, in respect of fleet owners. The required notifications have been issued recently and it is hope that this would also increase our revenues to an extent of about Rs. 75 lakhs per annum.

For the present, I shall rest content with the above measures, though we shall undertake separately an assessment, of the different taxes and the scope for widening and deepening structure of State Taxation.

I would, also refer to the fact that after a series of discussions with the Government of India in respect of the additional Excise on sugar, textiles and tobacco, the Government of India have finally agreed that the incidence of additional duties should bear a specific and direct relation to the rate of increases made by the State Government in respect of the State Sales Tax. In accordance with the decision taken at the Meeting of the Committee of the National Development Council, the Government of India have announced their commitment to raise the over all incidence of the additional duties to 10. 8% on the value or the clearances by the end of the Fourth Plan period. Certain changes in the rates of duties have already been made in the Central Budget of the current year and the yield from these charges is expected to result in additional revenues of the order of about Rs. 3 crores.

Before concluding, I would like to refer to an important matter which has been agitating the minds of the employees and the Government. Honourable Members are aware that in April, May and June this year, the Non- Gazetted Officers, Teachers and employees of the Zilla Parishads, Panchayat Samities, etc., went on strike for 56 days. Government had decided to treat the period of strike as dies non and had issued orders that the employees will not eligible for salary for the period of the strike. I am glad to announce that in view of the restoration of normalcy now, Government have reconsidered the matter and have decided to treat the period of absence as leave to which the employees are eligible and to the extent to which such leave is not available as leave not due to be earned by future service. I hope that the employees will appreciate that gesture on the part of the Government and give their best in implementing effectively policies to improve the lot of weaker sections.

I have now come to the end of the Budget Speech. The annual Budget is only one of the many instruments of social and economic policy available to the Government and I have attempted to delineate the directions of the developmental design to the extent it is possible to do so in a Budget. The problems faced by us are formidable and varied and I can not say--I leave the judgment to the House--whether we can look back with pride or even satisfaction. I would only observe that the Government are bound by a continuing commitment to strive towards a socialist society and in the fulfilment of this task, we can certainly look ahead with hope.

It is my duty to thank the Finance Secretary and his team. I must make a special mention about Sri S. R. Shankran, Deputy Secretary, Finance whose untiring hard work has gone into the preparation of this Budget.

I thank you, Sir, and the Honourable Members and with your permission, I present the Budget for 1971-72.