Previous Budget Speeches






THE BUDGET FOR 1999-2000

19 FEBRUARY 1999



1. I rise to present the Budget of the Government of Andhra Pradesh for the year 1999-2000.

2. While presenting this Budget for 1999-2000 before this August House, I cannot lose sight of the fact that this budget is the one to accompany us into the new Millenium starting from 1st January, 2000. Therefore there is cause for reflection. Though it is not possible to give full accounts of all that has gone by in the short Budget speech, a cursory examination to assess our preparedness to meet the development needs of the people and the challenges of the coming millenium is not out of place on this occasion.

3. In this regard, it is a matter of great satisfaction to the Government to reckon that sufficient conditions for a successful growth and development paradigm, have already been put in place. The Vision-2020 Document released recently by the Government sets a clear action platform for the launching of individual, community as well as government initiative to enhance the frontiers of growth and welfare for the people of the State. The institution building and systems stabilisation measures that have been carried out with revolutionary zeal in the last three years, have created the right environment and provided the strong moorings for people centred developments exploiting the benefits of growth. The tool of reform and revamp of critical areas of our Government working, impacting on our day to day life has created a clear policy framework. This will act as the initial growth stimulus which is so critical in the transition from a lower level equilibrium to a higher development spiral. Fortified with these strong socio-economic instruments and change agents the Government will lead the people of Andhra Pradesh into next millenium to make the State strong in all aspects of development, social, human and economic in the global environment.


4. As stated by me in the last year's budget speech, our Government under the guidance of the Chief Minister have prepared and released the Vision 2020 document on 26th January of this year. As Honourable Members are aware, this document sets out for the State, a new matrix of growth and development which has been hitherto unheard of in the State; for that matter in the Country also. There can not be a better statement to explain what Vision-2020 stands for than to quote from the fore word of the Chief Minister to the Document. "Andhra Pradesh to be a State where poverty is totally eradicated, that every man, Woman and Child to have access, not just to basic minimum needs, but to all the opportunities to lead a happy and fulfilling life and that we must emerge as a knowledge and learning society built on the values of hard work, honesty, discipline and a collective sense of purpose".

5. To achieve this ambitious goal, the economy of the State has to grow 9% to 10% a year on an average. Agriculture will have to grow at an average of 6% a year while Industry needs to grow at 11% and the Service sector by 12% a year.

6. Our Government is aware of the comments of the critics who have described the Vision-2020 as a mere dream unachievable to start with. But for us, it is a new agenda for action to be accomplished by redefining our strategy and re-engineering our tools and methods of working. We are convinced that the growth and development envisaged in the Document, though spectacular, is very much within our striking range, given its clear direction and specific focus on growth engines as prime movers. If there is going to be any impediment to this process, in our opinion, it will not be from economic factors; rather it will be from the social forces. We need a strong social structure to act as the bedrock for the economic forces to gather momentum.

7. To emphasize the point that anything new and bold need not necessarily be a dream infeasible, I would like to remind the Members of this August House the situation of skepticism prevailing, when the Government launched the new initiative of making Hyderabad an Information Technology and Software Development centre of international standard three years back. That Mission statement defined then, has come true now for everyone to see. The benefit of the image transformation for the State capital is just beginning to be felt. When the impact of the full growth momentum is realised, we will be well into the next Century fully globalised on par with any other international centre of excellence. For us, this was never a dream of deceptive development or to stay in stupor; it was always a job to be done and we have successfully accomplished it. Though it is just a beginning, it is a step in the direction of leap frogging the State into a higher growth trajectory of the next millenium.

8. In line with our commitment and firm belief in soliciting views from all sections and groups across the State, while launching any new initiative, on this occasion also the Government has chalked out a programme of broadbase consultation through debates at various levels spanning over nearly two months. The suggestion and views generated will help in fashioning the final shape of our Vision 2020 document.


. Though this unprecedented action agenda in Vision-2020 draws upon the strength and entrepreneurship of the people to a significant measure, the Government has to be the harbinger and catalyst of change to begin with. A proper policy environment and clear direction is the initial take-off conditions for any sustainable development. In this regard, I am very happy to say that our Government has already taken the initiative, steering clear of the decadence of the past. Honourable Members may recall that in the last years' budget speech, I had stated about the economic reform agenda we have started implementing for improving the State finance over a period of time. To support our reform, increasing investment in social sector and infrastructure built-up as well as programme for fiscal consolidation to achieve financial sustainability, the World Bank has signed an agreement with us to provide Rs.2,173 crores for investment of Rs.3320 crores in the priority sectors of our need. The proceeds of this loan is going to basic Education, Primary Health, Nutrition and Child Care, maintenance of Irrigation assets, improvement of Road network in the rural area with consequent employment generation and safety net programme for the employees and workers trapped in terminally sick public enterprises. This project will spread the benefits of human development in the vast rural areas of the State, where the process of genuine development has to be further accentuated. There cannot be a better plank for rural development than to develop the impoverished human resources of the rural areas.

10. Another equally significant step, which must not have missed the Honourable Member, is the strategy for Power Sector reform. It is a sad fact that energy sector instead of being the most powerful force has turned moribund over years of inadequate investment and neglect. Our Government has rectified and streamlined many of the immediate shortcomings in the sector. But for the long term sustainability of the sector, much more required to be done including creating a framework which can attract investment of Rs.22,400 crores in the next ten years. In recognition of this immediate need to put the sector into self-sustaining higher growth path, Reforms Legislation has been passed. As a first step in that direction, the generation, transmission and distribution activities have been unbundled and two new Corporations have been brought into existence from 1st February of 1999. The process of change and improvement ushered in through the reform vehicle will transform the availability of power both in terms of quantity and quality.

11. It is time for this August House to understand the implication of reform process in its true perspective. The investment programme of our reform has been inspired on all occasions to invest money for the upliftment of the poor and the common man. It is oriented towards rural area improvement by spending money on human resource as well as infrastructure need of the general mass. Therefore, the money being spent is on opening new schools in school less habitations, appointing teachers in teacher-less schools or constructing buildings where the school children do not have a shelter over their head to get protection against sun and rain. The emphasis of the investment is to provide buildings, doctors and drugs for the rural health centers so that more effective medical attention can be given to the men, women and children who need it the most. Similarly the investment flow under reform for the power sector is to make available better quality power in adequate quantity at reasonable price which is meant for poor and the common man, who cannot afford the luxury and investment of a generator. On the other hand for investment in major infrastructures like Ports, Airports, Power Stations, Industries, Information Technology, Tourism etc., the stress of our reform is on establishment of clear policy framework and enabling environment where the private sector investment will come to cater to the needs of the people. The budgetary support from the Government for these activities is either not given or is very negligible compared to the total investment being made. Therefore, my sincere request to all the Honourable Members is to see the two clear dimensions of our reform process, which is pro-poor while facilitating flow of investment for general growth. It is a model of true development with human face.

12. In certain quarters, doubts have also been expressed about the possible rise in electricity price because of reform. All over the World where reform has taken place, be it in U.K., Chile or anywhere else, the real price of power to the consumers have come down due to significant efficiency gain and competitive pricing of power under the vigilant eye of the public and the Regulator. There is no reason to believe that our State will not reap this benefit with the reform process moving ahead


13. As studies across countries have clearly established, it is the quality of governance and strength of institution, which are more relevant and crucial to development process rather than all the monetary input pooled together. Without good governance and effective institutions, the money for development either would not be available or when available would not be of much utility for appropriate application. They create the necessary conditions and a genuine environment for people to participate in the development process, to exploit the economic opportunities on an equal basis to create wealth for them. No experience has shown the vice-versa to be true.

14. It is these aspects which have engaged the attention of our Government right from the time we assumed office. I am extremely happy to say, almost with a tinge of pride that we have been successful in giving honest and transparent governance to the people of the State. This has been possible due to our deep sense of commitment to the people and their welfare. To deepen the culture of accountability in administration, grass root institution have been created and empowered in scale and manner unprecedented. The Hon'ble Members may recall that ours was one of the first States to hold election to the local bodies immediately after our Government coming to the office. To make them work in an independent and autonomous manner, the financial devolution to these institutions have been implemented on the basis of the recommendation of the State Finance Commission.

15. In addition to the Panchayth Raj institutions, we have started a string of new Self-help groups much beyond our explicit constitutional mandate to impart better quality to the development activities, for making the people, the central point of the process both as the activist as well as the recipient. The creation of Water User Association with statutory underpinning is one of the major steps in that direction. Similarly the DWCRA groups formed in large number across the State with the active encouragement and support of the Government have been singularly responsible for catalysing Women's' empowerment in the State.

16. Our experiments with local school education committees with parents as members for effective running of school, increasing enrollment and retention and improving the quality of education has become a good model for primary education expansion in the State. For better functioning of Women and Child care system the new Anganwadi Centers have been brought under the supervision of local Mothers Committees. Similarly the local ward and village committees federating all the local self-help groups formed for supervision of village level works have created the framework of total accountability.

17. The emphasis of the Government to introduce administrative reforms at all levels of Government working, the citizens charter and the concept of Social Audit is informed by the same deep conviction that any development to be meaningful must maintain continuous interaction with the people for retaining the administrative edge. With this redefined approach and pulsating institutions strewn across the State, sufficient capacity has been created to meet the challenges of our time when we enter the next millenium. With the partnership and proactive role of the people, the impact of our development effort will acquire a new depth and dimension. In our view, these steps though not amenable to quantification to capture them in figures of this budget, will be the real force to power our progress in the future.


18. As per the advance estimates for the year 1998-99, the Gross State Domestic Product at Constant (1980-81) prices is estimated at Rs.22,409.06 crores as against Rs.20,214.94 crores in 1997-98 registering an increase of 10.85 per cent. This growth rate is against the reported country average of 5.8% for 1998-99. This significant growth has been possible because of good performance of the Agricultural Sector.

19. The Per Capita Income at Constant Prices for the year 1998-99 is estimated at Rs.2643, as against Rs.2413 in 1997-98 registering an increase of 9.53 per cent in real terms.


. Honourable Members are aware of the criticality of the award of the Finance commission on the State resources. The constitution of the Eleventh Finance Commission, which should have happened earlier, was finally done on 3rd July, 1998 under the Chairmanship of Prof. A.M.Khusro. At the meeting of the State Finance Minister convened by the Commission on 2nd September,1998 we have raised a few issues in a preliminary manner. We have argued for a significant step up to the share of the States in gross tax revenue of the Centre, to enable the States bear the burden of development expenditure, which is increasing in the post-liberlisation period. We have also requested the Commission not to adopt any arbitrary cut off date for the purpose of working out the requirements of the States, on account of emoluments and terminal benefits of employees, as different States are in different phase of adjustments.

21. In accordance with its terms of reference, the Eleventh Finance Commission is required to take into account the maintenance expenditure on plan schemes to be completed by 31st March, 2000 only. As the present Ninth Plan will continue upto March 2002, the approach will leave out the commitments of the State Governments on the maintenance of plan schemes to be completed between March, 2000 and March, 2002. We had therefore, requested the Commission to take into account the full commitments of the State Government on account of the maintenance of all plan schemes to be completed by March, 2002. The Commission's attention has also been drawn to mounting debt burden of the States. We are now in the process of finalising our detailed memorandum to the Commission. We sincerely hope that the Eleventh Finance Commission will give a more favourable award to the State.


. In the implementation of Plan, we have been severely hamstrung by the forces beyond our control. When the budget for 98-99 was presented to this House, we were promised an amount of Rs.3567 crores as our share of resources from the central tax pool. But immediately after passing of the Budget, we were informed by the Government of India to take note of reduced availability of divisible funds curtailing it nearly by Rs.567 crores. As our Plan outlay was decided based on the resources communicated which had been incorporated in the budget figure 98-99, we had to seek additional loan funds to finance our Plan. This is one of the primary reasons for our higher revenue deficit in the revised estimate, as expenditure programme could not be rolled back with the same degree of ease or flexibility. Now, we are receiving further unnerving news that even this reduced amount may not materialise due to very poor indirect tax collection. As the room for maneuverability with us is extremely limited, any further adjustment can be painful.

  23. Inspite of such serious impediments to resource mobilisation, I have tried my best to meet the needs by relying more on State Tax and non-tax revenue and flows of other grants for the fiscal 1999-2000.

 24. The Plan Outlay for the current year i.e.98-99 as approved by the Planning Commission is Rs.4,678.95 crores. We have retained the same plan size in the revised estimate also. The outlay for Plan of 1999-2000 has been fixed at Rs.5,479.50 crores reflecting an increase of 17.11% over the outlay of the current year. Hon'ble Members would agree that this increase over last years' increase of plan outlay by 22.84% is a phenomenal achievement.

 25. About 30.79% of the Plan Outlay of the next year is earmarked for Social Service Sector, while Agriculture and Irrigation Sectors account of 27.10% of the Plan Outlay. Energy and Transport Sectors have been allocated 15.85% and 8.06% of the outlays respectively. Rural and Special Area Development programmes together account for about 15.12% of total Plan outlay.


26. As Honourable Members already know, Janmabhoomi was launched in the State in January, 1997 as a people centred development process aimed at achieving an overall growth and improvement in the quality of life of the people. The people centred development process is based on the following principles:

* People to identify and prioritise their felt needs in the Gram Sabhas.

* People to share the cost of community works.

* People to execute community works through their own self help groups without any intermediaries.

* People to review and audit the expenditure.

* People to own the assets created and manage their institutions.

27. Thus Janmabhoomi embodies and cherishes the principle of people's participation in development programmes with equal opportunity to all, which brings about transparency and accountability to the working of Government, leading to sustained economic well being and excellence in all walks of life. So far 9 rounds of Janmabhoomi have been held in the State, the last one being January, 1999. During each round of Janmabhoomi, Gram Sabhas have been held in every Habitation and Municipal Ward having more than 200 population.

28. Execution of community works, redressal of the grievances of the people, conduct of special Veterinary Camps, Special Health Camps, Cheyutha (disabled welfare), sensitizing the local community to the benefits of environment conservation, enrollment and retention of children in the school have been some of the major themes of Janmabhoomi. 87,356 community works at an estimated cost of Rs.1213.60 crores have been grounded so far, of which 64,360 works valued at Rs.821.38 crores have been completed. During the Janmabhoomi programme, 5.41 lakh children have been additionally enrolled in schools during the current academic year about 8.11 lakh children have been immunized, 9.44 lakh eligible couples have been motivated to adopt family planning methods, 84.68 lakh patients have been treated in 2.29 lakh Health Camps. 1.38 lakh Free Veterinary Camps have been organised covering 602.55 lakh animals. 4.02 lakh Individual sanitary latrines have been taken up so far and 850.99 lakh trees have been planted. Out of 19.55 lakh Individual Family Needs received in different rounds of Janmabhoomi, 17.54 lakh have redressed. 1.08 lakh Non Financial Community Needs have been solved, out of 1.21 lakh received.


29. During Kharif 1998, as against the normal cropped area 79.36 lakh hectares, 76.86 lakh hectares been brought under crop. The marginal shortfall of cultivable area is mainly under Coarse cereals, Pulses, Oil Seeds, Mesta and Chillies. It is estimated that the total foodgrain production would be of the order of 83.65 lakh MT. as against the normal of 79.80 lakh MT.

30. Due to heavy rains received during last week of September, continuing upto 1st Week of November, 1998, the crops like Paddy, Cotton, Groundnut, Sunflower, Pulses and Chillies has got damaged in an area of 13.35 lakh hectares either fully or partly. An amount of Rs.50 crores has been provided as relief to the affected farmers in the various districts for purchase of inputs, to undertake alternate crops. Where ever the crop is fully damaged (more than 50%) relief has been provided by the Government @Rs.750/- per hectare for crops like Jowar, Bajra, Ragi, Gingelly and Castor, Rs.1000/- per ha. for crops like Groundnut, Sunflower, Soyabean, Paddy, Maize and Redgram and @Rs.1250/- per hacter for high value commercial crops like Cotton, Sugarcane and Turmeric. The loans issued during the Khariff, 1998 season have been programmed for conversion into Medium Term loans and collection of Long Term loans is envisaged for reschedulement. This will help the ryots to be eligible for fresh finance during the Rabi season, 1998-99. For this purpose, the Government have sanctioned Rs.25 crores of assistance to the APCOB.

31. For better circulation of credit in the farm sector, the Interest Relief Scheme is being implemented to provide incentive at the rate of 6.25% on the prompt repayment of current dues, under Short Terms Loans to Cooperative Banks. This has required a support of Rs. 75 crores from the Government.

32. For the benefit of farmers, Government of Andhra Pradesh, for the first time is implementing a Comprehensive Agricultural Development Plan for overall development of agriculture in the State with an expenditure of Rs.10 crores.


. Horticulture Sector has a very strong contribution in increasing overall per-capita agricultural income in the State. Andhra Pradesh stands second in terms of area and production of fruits in the country. The total area under Horticultural crops is nearly 12.44 lakh hectares with an estimated production of 50.00 lakh MTs apart from 794 million coconuts.

34. To promote oilpalm development, which is a major thrust area, assistance is being provided at the rate of Rs.16,250/- per hectare upto 6 hectares. During 1998-99, an area of 2011 hectares has been brought under oilpalm cultivation with a financial support of Rs.5.4 crores.

35. To meet the severe shortage of onions in the local markets, the Government has started "Crash Onion Production Programme" during Rabi,98. About 66 tons of onion seed was distributed on 75% subsidy to farmers all over the State to cover an additional area of 9,000 hectares under onion crop. Further, a Scheme is proposed for advancing the sowings of onion during Kharif, 99 so that possible shortage of onion could be over come. This programme would entail an expenditure of Rs.3.00 crores.


. An outlay of Rs.10.5 crores is earmarked for Sericulture sector in the Annual Plan of 1999-2000. It is proposed to bring an additional area of 10,000 acres under mulberry and to produce 25,000 tonnes of mulberry reeling cocoons which will generate additional employment for 50,000 persons. With better maintenance of facilities and infrastructure, it is aimed to increase the productivity and quality of both cocoons and silk.


. In the wake of reports of Crop failure because of farmers using adulterated pesticides, Government have directed the Agricultural Market Committees to take up the sale of seeds, pesticides and fertilisers. So far about 175 Market committees have started this business. Farmers are finding this facility extremely useful as the Agricultural Market Committees are selling seeds, pesticides and fertilisers at prices much lower than the rates in the private market apart from the convenience of purchasing inputs at the same place where they sell their produce.

38. Rytu Bazars: The experiment of Rytu Bazar has become a success within a very short time. The Department of Marketing launched Rytu Bazars on 26.1.1999 in all the District headquarters and other important towns in the State. The concept is a win-win situation for both the farmers and the consumers. In a media survey carried out in certain places, it is revealed that nearly 75% of retail price of perishable goods go to the pockets of middlemen and traders. With the Rytu Bazar scheme in operation, the farmers are getting better price for their produce, while the consumers are also benefiting from low prices. There are plans to expand the spreads of Rytu Bazars in course of time.

39. As good storage is very vital for direct marketing of agricultural perishables, cold storage units are being planned to be set up at Major Market Yards in the State. During this year, 11 market Committees have been permitted to lease out the land to private entrepreneurs to establish cold storage plants in the market yards. We are exploring the possibility of establishing cold storage plants at all other important Market Centers in the State.


40. Livestock rearing can be a thrust area given our present strength and competitive advantage. To support this activity, veterinary care has to be constantly upgraded. During the year 1998-99, 494 New Veterinary Institutions has been sanctioned in the State to give better coverage to the animals. The Government is also encouraging private veterinarians to come forward to set up service centre and work in the rural areas.

41. It is estimated that about 1.85 lakhs of marine and inland fishermen are engaged in fishing culture. Apart from assistance for fishing crafts and nets through Fisheries Federation, housing needs of Fishermen community is being given its due priority. During the year 25,000 houses have been sanctioned exclusively for them


42. It can not be over-emphasized that irrigation Sector is a major force behind the development of agriculture. To get the best return at the earliest, Government have accorded highest importance to the rehabilitation of existing schemes. However, we are continuing our effort towards development of new Irrigation infrastructure and its expansion in the backward and drought prone regions of the State.

43. In the present fiscal year with an investment of Rs.164 crores, the Government have taken up maintenance and refurbishing of all Irrigation channels. The programme was implemented through the Water Users Associations spread across the State by giving them functional and financial autonomy. This approach which is first of its kind represent a major commitment on the part of the Government to revive the utility of Irrigation assets with the direct involvement of people. I am extremely happy to inform the house that with this effort, 5.12 lakh acres of land has additionally been brought under assured irrigation in tail-end areas during the current crop season itself. Such large increase in irrigable acreage within a short span of a few months, with a very moderate level of investment is an unique achievement.

44. Repair to more than 800 minor drains again carried out through Water Users Associations has protected farmers against loss from heavy rains and floods of October and November, 1998. Encouraged by the enthusiasm and response of farmers, Government have now planned to fully rehabilitate all major and medium irrigation schemes in the Sate within next one year by incurring a further expenditure of Rs.200 crores through farmers' organizations only. An amount of Rs.48 crores have been released for the restoration of breached minor irrigation sources, which would benefit about 3.79 lakh acres across the State when restored. Rs.25.5 crores have additionally been granted for the repairs of minor irrigation systems in the drought affected districts.

45. Significant achievements in commissioning of some of the major Irrigation Projects are the Priyadarshini Jurala Project, the Sriramasagar Project Stage-I (below Km.234), the Kalyanivagu and Sangeetam schemes under the Nizamsagar, the Telugu Ganga Project and 8 medium irrigation projects, namely Vattivagu-I, Satnala, Kowlasnala, Taliperu, Andra, Cheyyeru, Vengalarayasagar and Chalamalvagu.

46. Major focus of our irrigation investment is in the backward areas of Telangana, Rayalaseema and north coastal regions. Under phase-I of Flood Flow Canal Project, Government have accorded administrative approval to construct 140 km. length of the Canal and the Mid Manair Dam at a cost of Rs.859 crores which is to irrigate 68,000 acres. Under Bhima Lift Scheme, sanction has been accorded to construct Sangambanda reservoir at a cost of Rs.132 crores to irrigate 15,900 acres. Sanction has also been accorded to execute Gandikota Reservoir to irrigate 70,000 acres land in Cuddapah district. The Srisailam Left Branch Canal (SLBC) scheme has now been given a major thrust for its early completion. The modernisation works of KC Canal are being taken up to benefit an additional tailend ayacut of 52,000 acres. The balance works of Chitravati Balancing Reservoir are also being taken up for completion on priority. Apart from the above, flood protection works have been taken up in six coastal districts and in Khammam and Warangal districts. Under Vamsadhara Project Stage-II, works have been taken up to irrigate al last 20,000 acres in its command by July, 1999.

47. For providing drinking water on an immediate basis which is possible by recharging the ground water and filling the village tanks in drought affected districts of Kurnool, Anantapur and Chittoor, Government has given administrative sanction to execute Handri Niva Scheme to utilise 5.5 TMC of water. Works on canal excavation under the Scheme at a cost of Rs.68 crores will commence shortly. In the case of Veligonda project, construction work of Nallamalai Sagar reservoir will commence shortly in Gottipadia and Sunkesula gaps. Sanction has also been accorded to take up detailed investigation and execution of Nettampadu and Kalwakurthy Lift Schemes in Mahaboobnagar district, Suddavagu and Yerravagu medium project in Adilabad district and Surampalem reservoir in East Godavari district.

48. With a view to expediting clearance of pending projects, Government have set up a separate organization with a Chief Engineer to exclusively deal with the inter-State matters. Efforts are being made to resolve inter-State issues concerning the Bahuda, Janjhavati, Lendi and Penganga projects. Government has also taken very effective steps both at political and legal front to prevent Karnataka from constructing Almatti dam to an increased height, in order to protect our interest over the waters of river Krishna.


. Large extent of land, particularly in the arid part of our State is not being put to optimum use due to underutilisation of rain water. Government has launched a massive long term programme spread over ten years to cover one lakh hectares of degraded land at the estimated cost of Rs.3,700 crores under Watershed Development Programme. This programme is being implemented through participatory process involving farmers in the local watershed committees. The impact of watershed programme on recharge of groundwater and intensification of agricultural activity has been immense where the project has been started. Presently 4461 watersheds, each comprising of 500 hectares and with an outlay of Rs.20 lakhs each are under implementation in the dry land areas. During the year 1999-2000 a total amount of Rs.223.05 crores under various programmes is proposed to be spent.


. Honourable Members are aware that the State faced severe cyclonic storm and heavy rains during October/November, 1998, which damaged electrical installations and lines. The damage to installations and lines were restored on a war footing minimising the hardship to the consumers. However, the unprecedented inflows into the Srisailam reservoir and consequent heavy discharges of water led to inundation of Srisailam Power House on 15th October, 1998. I am happy to inform that the restoration of all the 7 units of the Power House has been achieved in a record time. Another calamity in the shape of a fire accident occurred at Kothagudem thermal power station, which has put two units out of operation. Necessary rectification works have been started to bring back the units for power generation in the shortest possible time.

51. Inspite of the above mishaps, the Plant load factor of generating stations continued to be high and the State could supply 32,628 Million Units of energy by the end of January, 1999 as against 31,002 Million Units during the corresponding period of last year registering an increase of 5.24%. The State has been able to supply power free of any significant restrictions during the critical months of the last summer season and has kept up its commitment to provide 9 hours of assured power supply to the agriculture sector.

52. During 1999-2000 we are planning a capacity addition of 1388 MW with major contribution from Short Gestation Projects. In the State sector, the first unit of 150 MW of reversible turbine of Srisailam Left Bank Power House is planned for commissioning. In addition, 2 units of 7.5 MW at Singur and 5 MW Mini Hydal Schemes are also going to start power generation. The Annual Plan 1999-2000 provides for an outlay of Rs.868.31 crores.


53. Our Government is convinced that the Human resource development of the state is the key to all our success as all international experience without exceptions have proved. The Government is determined to achieve universal elementary education by 2005 AD, and as a matter of priority we are making an all out effort to improve access to schools. Our plan is to provide 98% of the rural habitations with primary schools within a distance of 1 K.M. and the gross enrolment in class to be 83% upto fifth standard. Realising this importance, more than 70% of the total educational budget this year is provided for Primary Education alone.

54. It is needless to say that such a massive task of universilization of elementary education by the year 2005 A.D. requires large strength of teaching faculties. To meet this need, a massive recruitment drive has been launched to fill up 40,000 teacher posts in the current academic year. Besides there is a critical need to train the teachers in the latest methodology of teaching. To impart training to large number of teachers we have first taken up training of key resource persons at the district level who in turn will conduct training for teachers at sub-district level.

55. The District Primary Education Programme (DPEP) model which has been successful in the first phase in five districts of Vizianagaram, Nellore, Kurnool, Karimnagar and Warangal is being extended to 14 more districts in the State under the AP Economic Restructuring Project. We have started 21,965 school buildings in the needy areas to augment the class rooms with an outlay of Rs.249 crores.

56. The Government has taken note that the literacy rate among the minority community is very low, To improve the situation, the Government has sanctioned 300 additional posts of Urdu teachers exclusively for Urdu Medium Schools. The AP Open School Society has started two study centers in Hyderabad district. The study centre will work for reducing the drop out rate

57. Considering the significance of community and people's participation to improve the spread and quality education, this August House has enacted 'A.P School Education Community Participation Act 1998' which enables the government to transfer the resources to the school committees, which can plan, manage and promote education in their respective areas. Financial assistance is also being provided to school committees to engage vidya volunteers to augment the strength of teachers for better attention to children..


. Honourable Members are aware that upgrading and expanding health services and medical facilities is a continuing process. To cope with the increasing demands on the health facilities, the Government have initiated a number of measures to extend comprehensive and quality health cover to the people of the State. In the desirable scheme of things, Primary Health Sector has to be accorded the highest priority to provide quality and reliable health care to the people. In order to ensure this, the Government are investing Rs.322 crores to ensure that all Primary Health Centres have their own buildings, existing buildings are renovated and centres are manned by good staff supported by proper equipments, adequate drugs and consumables. This investment will act as the critical balancing investment for the secondary and tertiary health care system to optimise their service delivery.

In the Secondary Health Sector, we are implementing the A.P. First Referral Health Systems Project to ensure delivery of high quality health care at the first referral level and to institute a streamlined and systematic referral system. Over 200 hospitals are being upgraded under the Project which has made very good progress. The programme will be completed well before 2002 AD, the scheduled year of the project completion.

60. We have invested over Rs.20 crores towards maintenance of tertiary level hospitals, increased bed maintenance and diet charges, and taken steps for providing sophisticated equipments such as C.T.Scan to Osmania General Hospital, Kurnool General Hospital and King George Hospital, Visakhapatnam. We have also created the A.P.Illness Assistance Fund with a Corpus of Rs.15 crores to provide free treatment to people below the poverty line in respect of serious medical ailments involving super-speciality and expensive medical interventions.

61. To meet the increased demand of health care, expansion of facilities for medical and para-medical education in the State is essential. Recognising this need, 120 additional seats have been sanctioned in Government medical colleges. Government have approved the establishment of 5 medical and 5 dental colleges under private management which are fulfilling norm of Medical Council of India. 178 private para-medical institutions have been given in principle sanction based on the recommendations of Justice Ramachandra Raju Committee.

62. Government is giving the highest priority to the control of population growth in the State. Family Planning has been brought to the core of the State's development agenda. We have announced a State Population Policy, identifying the demographic goals to be achieved within a specific period of time, and delineating the specific interventions required to be implemented to achieve the goals. A separate allocation of Rs.15 crores has been earmarked for State population policy interventions. It is a matter of happiness for all of us that our efforts are bearing fruit. The birth rate in our State has decreased to 22.7 per 1000 live births in 1996 and we stand 3rd in the country next only to Kerala and Tamilnadu in lowering the birth rate. It is our attempt to ensure that the birth rate is reduced to 19 per 1000 live births by 2000 AD.


The basic development need of the Scheduled Castes families being Education, the Government is constantly improving the spread and access to better quality education. We have started College Girls hostels in all 23 districts providing accomodation to 1588 college going students. Apart from providing facilities for 2.27 lakhs students in the Social Welfare Hostels, under the Pilot Project Programme known as 'Back to School', 143.599 working Dalit children, who are either dropouts or who never joined the school, have been given intensive coaching for a period of two months during the last summer by incurring an expenditure of Rs.6.41Crores. Out of them, 91,384 students have been admitted into schools and 52,215 are staying in the Social Welfare Hostels. 5255 Children from unclean occupations families have also been admitted into schools. 4,895 candidates were given training by Pre-examination training centres, preparing SC Graduates to face the challenge of Competitive exams like All India Civil Services Exam, Group I Services of the state etc.

64. During the year, 38 new schools and 5 Colleges for Bachelor of Computer Education have sanctioned to be run by AP Social Welfare Residential Educational Institutions Society. Identifying the need for Computer education, Computers have been introduced in 23 Social Welfare Residential schools.

65. The income ceiling for Post-matric Scholarships has been enhanced from Rs.33,444 to Rs. 38,200 for Under-graduate course and for Rs.44,500 to Rs.50,290 for Professional and Post-graduate courses. At present, we are providing assistance to 1,33,175 students under Post-metric Scholarship scheme. 1000 additional seats have been created under Bright Boys Scheme, The incentive for inter-caste marriages has also been enhanced from Rs.3,000 to Rs.10,000 plus a package of assistance of Rs.15,000 from DRDA/ SC Corporation and Nationalised banks.

66. We have observed that there is great need for extending irrigation facilities to the lands of Schedule Caste farmers. Therefore, we have enhanced the allocation for providing irrigation facilities in the lands of Schedule Caste farmers from Rs.2 crores to Rs.17.9 crores in the next year budget to give a major boost to their income in rural areas.

67. AP Scheduled Caste Cooperative Finance Corporation engaged in providing economic support assistance to S.C families is celebrating its Silver Jubilee this year. The thrust areas identified for the Corporation this year are :

(1) Coverage of 1.99 lakh beneficiaries with a total investment of Rs.168 Crores in 1998-99 under the Action Plan.

(2) Skill Development Programme for leather artisans.

(3) New Horticulture Plantation in an extent of 13,000 acres.

(4) Intensive Computer Training Programme for 2550 Scheduled Caste Graduates with an outlay of Rs.6.32 crores.

(5) Silver Jubilee Scholarships for the 2500 Professional course Students, @ Rs.4,000 with an outlay of Rs.1 crore

68. To address the problem of very high poverty in certain parts of our state, a Poverty Initiatives Project is proposed for launching. It is a multi-sector project being formulated for alleviating the conditions of rural poor in six of the poorest districts of Andhra Pradesh with an investment of Rs.616 crores.


69. For the economic and social advancement of Backward Classes Government has already announced a comprehensive policy. In this direction our Government has launched a unique Artisan Assistance Project called 'ADARNA' to benefit 10 lakh BC Artisans by providing improved Hand tools, power tools small technological equipments and other means to improve livelihood. Primary objective of this project is to minimise human drudgery while enhancing productivity and the quality of products made by the BC Artisans. We have made a provision of Rs. 121 crores in the budget for 1999-2000, stepping it up from the current year's outlay of Rs.100 crores

70. Government has enhanced the income limits for scholarships eligibility from Rs.18,000 to Rs.33,500 per annum in respect of general courses and from Rs.24,000 to Rs.44,500 per annum in respect of professional courses. To provide accommodation for more children, 7,874 additional seats have been created in the existing BC hostels during 1998-99 besides opening one new Residential School at Chityal in Mahaboobnagar District. To motivate the wardens and matrons of BC Hostels, the Incentive award has been enhanced from Rs.100 to Rs.1000. for 75% or above result is in the SSC Examination. To prepare students for various competitive examinations, two more Study Circles for BC Students have been opened at Srikakulam and Karimnagar.


71. The Government has identified large extent of land that are lying fallow in tribal areas. The productive potential of these lands remain untapped. On the other hand, the Tribal Youth and Tribal farmers are remaining idle due to lack of adequate employment opportunities. To use the land and create rural employment, it is resolved to match the potential of both these factors - manpower and the land, by purchasing such fallow lands which will be provided to Tribals for agricultural activities. Apart from the land, the Tribal farmers and youth would also be supported financially for developing these lands into useful agricultural fields with more emphasis on high value horticultural and floriculture crops. An amount of Rs.35 Crores has been provided for the scheme in the budget for 1999-2000. .

72. Under various Economic Assistance Programmes, we have covered 122,600 tribal families and the balance are being planned to be assisted in a phased manner. Among various economic activities, Tribals are being encouraged to take-up Coffee Plantations in about 50,000 hectares of unreserved lands in Paderu and Rampachodavaram ITDA's and Horticulture Projects in plain areas. A Grain Banks scheme has been launched, to provide foodgrains to Chenchus in Nallamala forests. So far 20 Grain Banks have been opened covering 1,617 families.

73. To improve enrolment and retention, a Mid-day Meal programme has been launched in the Schools of Tribal area. 6 new Residential Schools have been sanctioned during this year. 12 Residential Schools have been upgraded to Residential Junior Colleges. To improve infrastructure in the educational institutions, Rs.9.00 Crores have been provided for construction of school buildings. .

74. To provide improved health care in the remote Tribal areas, all posts of 253 Medical Officers were filled up and 108 Primary Health Centres were provided with Jeep-cum-Ambulances. 2125 Community Health Worker posts have been sanctioned to work in remote tribal areas. 111 non covered habitations/villages and 714 partially covered habitations/villages have been covered under ARWS and RWS. 14,300 houses have been taken up under IFAD Habitat Improvement Programme, besides 23,670 RPH and SPR houses under weaker section Housing Scheme.

75. For improvement of infrastructure in tribal areas, the Government has decided to increase the allocation by Rs.7 crores in the budget of 1999-2000, increasing it from Rs.6.18 crores provided in the current year.


. The Government is conscious of the need to provide extra care and intensive attention to the problems of the minorities to find solutions to the large-scale illiteracy, unemployment and poverty. As a part of the Policy for the Advancement of the Minorities announced in 1996, various schemes have been launched for Economic Development, Health awareness, Women Development, Educational Development, etc. The institutions like Andhra Pradesh State Minorities Finance Corporation, Andhra Pradesh Minorities Commission, Andhra Pradesh State Wakf Board, Urdu Academy, Andhra Pradesh Commissionerates of Wakf survey and Minority Welfare have been strengthened to implement the programmes in an accelerated manner.

77. We have made a provision of Rs.29 crores for Minority Welfare in the budget of next year stepping it up from Rs.25 crores in the current year. Apart from our budgetary resources, funds are being accessed from National Minorities Development & Finance Corporation [N.M.D.F.C.] for sanctioning Margin Money loans as well direct and small loans. An Entrepreneurship Development programme with Escort service has also been implemented. A special programme for the economic Development of Minority Women in Urban Areas called as DOUMA has been started


78. The health and nutrition standard of the Children and Women is a very vital factor which is in need of adequate attention and investment. To achieve this. besides 200 continuing ICDS projects, 42 new ICDS projects have been launched during 1998-99 with 7262 Anganwad's covering 6 lakhs children and women. Under the A.P. Economic Restructuring Project, remaining uncovered areas will be covered under ICDS projects. An amount of Rs.134.00 crores has been earmarked in the project for construction of 8,816 buildings for Anganwadi centres which will make it possible to provide better services.

79. Our Government has been making serious attempts to bring about a change in the attitudes of parents and society towards the 'Girl Child'. We have released Rs.29.00 crores to cover 50,000 girls under Girl Child Protection Scheme., This is aimed at bringing change in the mindset towards girl children and motivating the parents to give them education. Government has also launched a new scheme during 1998-99 called 'Integrated Girl Child Labour rehabilitation Programme' with a provision of Rs.1 crore to discourage girl child labour.


80. DWCRA groups formed with the active encouragement of the Government have seized the local initiative of exploring micro economic opportunities available in abundance. There are 82,000 DWCRA groups in the State covering 12.30 lakh women and Rs.125 crore has been provided as revolving fund matching the saving of Rs.200 crores mobilized by the groups. About 50% of the DWCRA groups in the country are in our State itself. These self help groups have become active partners in the development of their villages. The target of the Government is to form at least one women Self Help Group in each habitation by the end of this year.

81. Women Self-Help Groups are encouraged to come together as Co-operative Societies at the Village level and by federating them at Mandal level under Mutually Aided Co-operative Societies Act for improving credit access from financial institutions, donor agencies, DRDAs and voluntary organisations.

82. We are providing Marketing support to the DWCRA groups through DWCRA Bazaars. DWCRA Bazaars are being set up in all the Districts and a permanent DWCRA Bazaar is planned at Hyderabad. This has proved to be a successful effort.


. I am happy to inform the House that C.M.E.Y. program has so far provided employment opportunities to 56,040 youth. Already, 7,000 youth associations have been given administrative sanctions for grounding economic activities under Business, Service and Industries sectors. As a continuous process, Entrepreneurship Orientation Programme is going on to train the youth to identify required economic activity under the CMEY programme. A 'Youth Bank' is proposed to be set up for the benefit of the Youth/ Youth Associations.

84. Construction of Youth Hostels as a joint venture between State and Central governments is continuing and these hostels have started functioning at Secunderabad and Tirupathi. Construction of hostels is at different stages at Visakhapatnam, Warangal and Nagarjunasagar.


. For the first time in the country, the State of Andhra Pradesh have introduced welfare programme for disabled persons called 'CHEYUTHA' on mass scale during the last 3 rounds of Janmabhoomi Programme. With an expenditure of Rs.13.73 crores, surgical operations, Aids and Appliances, marriage incentives, unemployment allowance, scholarships and economic rehabilitation have been provided to the disabled.

86. The Government of Andhra Pradesh have released two policy uploads viz., Empowerment of persons with disabilities (Cheyutha 1998, 2000) and State Action Plan for persons with disabilities. The policy document and plan of action have laid down details of implementation plan to create an enabling environment of equal opportunities for the disabled.

. To provide Financial Support and Livelihood to the Old Age persons who are destitutes, State Government, has sanctioned additional 2 lakhs Old Age Pensions under Old Age Pension Scheme in addition to the present coverage of 8.95 lakh old age pensioners. During the year 1999-2000. an amount of Rs.56.55 crores has been budgeted to disburse old age pension.


Our Public Distribution System has a very wide network of fair price shops in the State catering to people even in remote and hilly areas. Out of a total of 39,853 fair price shops, 32,815 are in rural areas and the remaining 7,038 are in urban areas. On an average each fair price shop caters to 1,926 persons as against the rule of the thumb optimum of one shop for every 2000 population

89. The subsidised rice programme of our Public Distribution System is the widely appreciated safety net programme. We are supplying 21.6 lakh tonnes of rice per year to the 113 lakh white cardholders. This scheme needs a budgetary support of Rs.1062 crores in the next year going up from the present level of Rs.712 crores provided in the budget of 98-99. This substantial step up in the outlay has been necessitated because of the steep price increase effected by the Government of India in the issue price of F.C.I. The Government has decided to absorb the full impact of the price rise without increasing the price of rice at the consumer end.


In addition to the Public Distribution Programme, we are closely monitoring at the highest level the price trends of wage goods going into the consumption basket of the common man on a day to day basis. We are taking immediate corrective steps whenever necessary.

91. In order to ensure that the essential commodities particularly Rice, Redgram, Tamarind, Chillies, Edible oils and Onions are available at a reasonable price, the State Government undertook market intervention and procured these commodities both within and outside the State. The Government gave a subsidy of about Rs.2.00 crores during the year 1998-99 to make available these commodities to the consumers at a reasonable price.

92. Recently the State Government has taken a decision to procure essential commodities viz., Onions, Chillies, Tamarind, Redgram and Groundnut oil during the period when the prices are low and release the same to the consumers at affordable prices through the net work of Fair Price Shops during lean period. All the Government agencies like Civil Supplies Corporation, GCC, MARKFED, OILFED have been kept on alert to pool their resources to successfully intervene in the market when the situation demands.


Our Government have been attaching very high priority to provision of good quality shelter to the poor. During the year 1997-98 the construction of 3.64 lakhs houses is the highest when compared to achievements of any previous year. Hon'ble members would be happy to note that HUDCO has again given an outstanding performance award for the year 1997-98 to Andhra Pradesh in recognition of our performance in housing.

94. To meet the increasing costs of housing material the Government have enhanced the unit cost of Rural Permanent Houses from Rs.12,000/- to Rs.17,500/-, the Semi Permanent Rural Houses from Rs.5,000/- to Rs.7,500/-, the Economically Weaker Sections Houses Ordinary from Rs.15,000/- to Rs.25,000/- and Economically Weaker Section Houses, Special from Rs.25,000 to Rs.30,000/-. In all these categories, the subsidy component has also been raised ranging from Rs.2000 to Rs.2250/- per House. For the ensuing year 1999-2000, it is proposed to construct 4 lakh houses with a project outlay of Rs.995.70 Crores.

95. Demand for house sites in rural as well as urban areas continues to be very high. Taking note of this demand, the Government has launched an action plan to provide 5 lakh house sites in the current financial year. In addition, we are taking up special programmes for site development and provision of infrastructure.


. The concern for healthy life by the people in State which is only possible by keeping our environment and surrounding clean and green, has prompted the Government to take a new initiative called as "Clean and Green" programme. Under this initiative, cleaniness of the ambience of our living, be it urban or rural area have been given adequate focus. We have identified that extension of low cost sanitation programme is the urgent felt need of the people both in villages as well as in towns. Therefore the Government has launched a massive programme of construction of individual latrines for improving the habitation and quality of living. We have programmed to construct 5 lakh latrines in the urban areas and 2.34 latrines in the rural areas in 1998-99. To facilitate the programme, Government is giving a subsidy of Rs.2000 per latrine in the rural area and Rs.1552 per latrine in the urban area.

97. Vehicular pollution has become a matter of concern for all of us. To generate awareness among public, pollution checks were conducted in large number of urban areas. We are motivating the vehicle owners to observe pollution emission norm in the interest of everyone.

98. To address the problem of disposal of industrial solid waste, the Pollution Control Board have recently finalised the agency which will take up this work to take care of 38,000 tonnes of industrial hazardous solid waste arising in and around the city of Hyderabad. The centralised pollution treatment facility at Bollaram, Jeedimetla and Patancherru have also been strengthened. The major waterbodies of Hyderabad city are being improved for recreational purpose by controlling pollutants and to meet the cost, we are implementing the polluters-to-pay principle. This will act as an effective deterrent.

99. In addition, we are scaling up our tree plantation and forest conservation programme which has a major role to play in our environment improvement drive. Apart from 10.80 crores seedling and trees planted during Janmabhoomi programme during the year, Forest Department is undertaking a large scale plantation through people centred approach. Rehabilitation of the degraded forests has been taken up under the Andhra Pradesh Comprehensive Forestry Project with the participation of people living in and around forest through Joint Forest Management Programme. Commendable progress has been made in this regard and presently, 6,271 Vana Samrakshana Samith's (VSSs) are managing 14.84 lakh hectares of forest land. This programme would be extended to 6,806 forest fringe villages covering a total forest area of 16 lakh hectares. Apart from this, the degraded forests are also being developed under the Bio-diversity conservation and Eco-development scheme. So far 200 Eco-development committees have been formed involving 35,000 families. Under the Hazard Mitigation Project 1,100 hectares of shelter belt plantations have also been taken up along the coast line to prevent cyclonic erosion and improve the green cover along the coast.


To generate adequate employment in the Rural Areas, Government is utilising all opportunities by tying up finances from various Centrally Sponsored schemes with suitable matching assistance from the State. During the year 1999-2000, it is proposed to spend Rs.387 crores on the Rural Employment Schemes under JRY, EAS and Million wells schemes. These programmes along with other infrastructure development and construction activities planned under large projects like Economic Restructuring Project will create adequate employment opportunities in the rural areas.


Our thrust in urban sector has been on development of urban infrastructure and provision of basic minimum amenities in the urban slums. For the year 1999-2000, a budget provision of Rs.39.00 crore is proposed for the Municipalities and Municipal Corporation for this purpose. In addition, Rs.27.00 Crore is proposed for Hyderabad Metro Water supply and Sewerage Board. Water supply improvement schemes with HUDCO assistance for 37 Municipalities with a total cost of Rs.373 crore are under implementation. For improvement of slum areas under centrally sponsored National slum Development Programme, an amount of Rs.23 crore have been released during 1997-98. Under 10th Finance Commission Grants, improvement of water supply and sewerage schemes have been taken up in all the Municipalities. Allocation under this scheme is proposed to be stepped up to Rs.22.48 crore for the year 1999-2000.


. Provision of safe drinking water to every habitation at the earliest is on top of our development agenda. An action Plan is being discussed with Government of India which will solve the problem of scarcity in 28,083 partially covered habitations during Ninth Five Year Plan. At present we are implementing 14,933 works to cover 3400 partially covered habitations under ARWS, MNP and SFC with an outlay of Rs.290 crores. For the year 1998-99, an amount of Rs.99 crores is allotted under ARWS, Rs.109 crores is allotted under MNP and Rs.82 crores under SFC for covering of 3400 partially covered habitations.

103. As Hon'ble members are well aware, flouride and brackish water contamination is a major problem in many of our districts. There are 6833 fluoride, 4328 brackish and 441 iron affected habitations to be covered. Under Sub-Mission on control of fluorosis and brackishness, 58 projects have been sanctioned with an outlay of 613 crores on the basis of cost sharing in 75:25 ratio between the Government of India and Government of Andhra Pradesh. These projects will help in supplying the protected water to 4216 affected habitations benefiting a population of 61.16 lakhs. Out of 58 projects sanctioned, 24 are completed and the remaining 34 projects are targeted for completion in a phased manner by June'99.

104. To mitigate drinking water scarcity during summer season, we are monitoring on a weekly basis the maintenance of 2,24,348 hand pumps, 20,192 PWS and 98 CPWS schemes Special drives are also being given to keep the surrounding of hand pumps, stand posts and drinking water wells clean and free from stagnation of water. The OHSRs and GLSRs. are being cleaned at frequent intervals.


. We have planned a very large programme of investment in State highways, major district roads as well as rural roads. We are in the process of preparing a comprehensive maintenance plan for the core network which carry the bulk of our traffic. In order to take up a massive programme for maintenance and improvement of roads, the Government have established the A.P.Road Development Corporation during 1997-98. The Corporation is augumenting the efforts of the State for road improvement. Similarly with the funds from the World Bank, Government have taken up projects for improvement of 3,200 Kms of roads under the State Highway projects, 840 Kms. under the A.P.Hazard Mitigation Project. Under the Economic restructuring 1243 Kms of major District roads and State Highways are proposed for upgradation. 3220 Kms of rural roads in the district of Adilabad, Warangal and Karimnagar have also been identified for intensive improvement under the same project. With the assistance of rural infrastructure development fund of NABARD, rural connectivity is being improved. So far we have taken up 3725 Kms of road network for improvement under the programme.

106. In order to make the State a hub for tourism, commerce and industry, the Government have decided to set up an International Airport at Shamshabad, as the present Airport can not have the landing facility for big-sized plane. Reputed Consultants have been appointed to go into all aspects relating to the setting of the International Airport. The Government is also exploring the possibility of having an International Airport at Visakhapatnam.

107. The State has enormous potentials to develop shipping and port activities considering the long coast line of the State. For improved and efficient operations of port facilities, the Deep water port at Kakinada have been leased to a private consortium for operating the berths. The State has been successful in attracting private investment to develop Krishnapatnam as a major port and Vadarevu Port for ship breaking activity and other lighterage operation. We are looking at different options for quick development of Gangavaram, Machilipatnam, Bhavanipuram, Bheemunipatnam, Nizampatnam also.


During the year 1998-99 upto 31st December, 1998, the State has received 206 new proposals for setting up of Large and Medium Scale Industrial Units involving an investment of Rs.24,118 crores During the year, 235 Large and Medium Scale Industrial Units have been established with an investment of Rs.2,804 crores which created employment for 32,658 persons. In the small-scale industry category, 19,274 units have been established with an investment of Rs.1670 crores providing employment to 1,10,540 persons. Under the Prime Minister's Rozgar Yojana (PMRY), against a target of 34,200 units, 15,779 cases have been sanctioned with an amount of Rs.45.7 crores out of which 3958 units have already been established as on 31.12.1998. Efforts are being made to create world class infrastructure at select locations to facilitate accelerated Industrialisation

109. Because of very large employment potential in Garments and Leather products industries and also very good export market for these products, the Government has decided to give adequate thrust to these industries in our State. In this regard, we have already taken steps for the establishment of an Apparel Export Promotion Park with good quality common infrastructure at Gundla Pochampally. It is proposed to provide supporting services like international banking, warehousing, container services, telecommunications etc., to this park. The Government intends to establish one more Apparel Park in the State..

110. Similarly the Government has entered into a MOU with CLRI to start a training centre for leather garment manufacturing. The Institute has started functioning from 7th December, 1998.

111. In order to develop small scale sector and to realise its full potential in our State, we have launched a new policy initiative for small enterprises after a wide ranging consultations with SSI Associations.


The State Government have been giving considerable importance to the welfare and development of the weavers as well as the industry. Certain neglected groups working in Handloom Sector are being focussed for development during 1999-2000 by evolving specific schemes for their benefit. One of most significant programme is the Rehabilitation of Shed Workers. Under this scheme, it is proposed to provide infrastructure support at 3 places in the State. It is also being planned to introduce family pension scheme as a welfare measure of lasting utility. Under this scheme, a family pension of Rs.250/- per month will be paid for a period of 10 years to the nominee/legal heir of the deceased weaver member.


. Honourable members already know, tourism is the largest commercial activity in the world with very high empIoyment generating capability. I am happy to inform that the State Government has come out with a comprehensive Tourism Policy which creates the appropriate environment for investment. In recognition of the thrust that this activity requires, in the present fiscal year the Annual Plan allocation was increased from Rs.1.20 crores to Rs.45 crores. For the year 1999-2000 we have maintained the outlay at Rs. 45 Crores. This outlay is meant for investment in high quality tourism infrastructure which will attract adequate investment from the private sector also.

114. In order to develop Tourism in a broad base manner throughout the state, the District Collectors have been made the Chairman of District Tourism and Culture Promotion councils in the districts and an amount of Rs.1 crore has been allocated to each district to take decentralised initiative to promote tourism.


. The strategy of the State Government has been to pursue an integrated approach to achieve the multiple goals of Information Technology with negligible Government investment set by us. The State has already facilitated the establishment of HITEC CITY. It has been very successful in attracting the I.T. Industry and Companies like Microsoft, Oracle and Metamor, which are setting up their facilities here.

116. With the Government support and encouragement, the IT industry has come forward to establish the Indian Institute of Information Technology (IIIT), a global center of excellence in Information Technology. This institute is industry-sponsored, self-financed and autonomous. It is taking the form of a core institute with a cluster of 8 to 10 schools operated by global leaders in the I.T. industry. The institute has successfully started a 4-year undergraduate diploma programme for which the response has been immense. It is expected that the IIIT will be given a deemed University status by a Statute as indicated by the Government of India.

117. Honourable Members are aware that the State Government has successfully implemented the CARD project, which is aimed at providing computerised registration in the Registration and Stamps Department. 212 sub - registrar offices were computerised through this project and the services have been made available throughout the State in November, 1998. Statutory functions are also being carriedout through this system since February 1999. This has brought about transparency in the service apart from making it effective and much less time consuming.

118. All M.R.O. Offices are also proposed to be computerised in a phased manner in order to provide effective services to the public. Phase-I of the programme has been taken up and implemented in 77 Mandals at an estimated cost of Rs. 4.5 crores.


. The State suffered from heavy rains and cyclone from 20th September to November 1998. The floods in Krishna river which was the worst during the last 34 years, required urgent evacuation of over 1.00 lakh people in the districts of Krishna, Guntur and Nalgonda within a short span of 10 to 12 hours.

120. The expenditure under Calamity Relief Fund during 1998-99 has been Rs.312.54 crores. Though the Central Government promised a grant of Rs. 200.00 crores to tide over the situation, they have finally released advance central assistance only, which is going to be adjusted in the next three years.

121. The Government of Andhra Pradesh have launched a novel scheme called 'Apathbandhu' on 02-10-1998. This Scheme is an Accident Insurance Scheme for the below Poverty Line Families. The scheme seeks to provide insurance cover of Rs.1 lakh for adults and Rs.50,000 for a child in case of accidental death in the family. It would cover deaths resulting from natural calamities, breakdown of law & order, collapse of buildings, damage due to earthquakes atrocities against S.C.s and S.T.s etc. The Government has paid Rs.2.1 crores to towards premium to provide the insurance coverage.


The general law and order situation in the State has been well maintained. The activities of the extremists groups particularly the outlawed PWG has been tackled effectively this year. Perhaps for the first time in the country, our State has prepared a comprehensive Victim Rehabilitation Scheme for those who suffered at the hands of naxalites. The scheme seeks to compensate the victim for the loss of life, limbs as well as property

123. We can usher in an era of rapid Economic growth by controlling destructive activities of extremists, factionist and communalists. The Government is determined to curb such lawless forces who are impediments to the well-being of the people and development of the State.


We are in the constant process of designing new measures and methods to make the administrative machinery more responsive to the aspiration of the people. To make it a continuing process, a Cabinet Sub Committee has also been constituted. The reach and scope of administrative reforms is at all levels starting from the Secretariat to the Mandal level. Committees have been formed at all the levels to identify the areas for simplification of rules and procedures. The Government has also launched a massive drive for reviewing and revising the innumerable age - old Manuals, Codes and Acts etc. for effective administration which can meet the challenges of the modern age.

. To improve the response of the administration to the needs and demands of the community, we have also initiated a large scale training programme for our employees through Dr.Marri Channa Reddy Human Resource Institute of Administration. After identifying the training requirement at the different levels, appropriate training modules will be used for upgrading the skill and knowledge base of our staff to handle the job better.

126. When challenges in the administrative work are increasing, we can not afford to lose sight of the welfare of our employees. In response to their request for salary revision, as Honourable Members know, we appointed the Pay Revision Commission on 31st January, 1998. As the pay adjustment work is a delicate and time consuming process, the Government has agreed to pay an interim relief of 11% of basic pay to all the employees as well as pensioners in the State effective from 1st June, 1998. This involves an expenditure of Rs.360 crores per year. As this commitment has to be accommodated, we have made suitable adjustments in the revised budget estimate of 1998-99.

ACCOUNTS 1997-1998

The final accounts of 1997-98 reveal a revenue deficit of Rs.703.19 crores. After taking into account the transactions on capital as well as public accounts, the year closed with an overall surplus of Rs.48.62 crores.


Transactions as per the revised estimate of 1998-99 indicate a revenue deficit of Rs.1087.56 crores as against the budgeted revenue deficit of Rs. 589.19 crores. The overall transactions of the year are estimated to result in a net deficit of Rs. 68.06 crores. After taking into account the opening cash balance of Rs. 48.62 crores, the year end balance is estimated to be (-) Rs. 19.44 crores.


. During the financial year 1999-2000, we have programmed for an expenditure of Rs. 19,189.71 crores under Non Plan and Rs.5,032.73 crores under State Plan. This will result in a revenue deficit of Rs.1,563.93 crores. After taking into account the overall transactions of the year, we will have a net deficit of Rs.166.44 crores. With the opening balance of (-) Rs.19.44 crores, the financial year is expected to end with a negative balance of Rs.185.87 crores.

130. With these words, I now commend the budget to the House for approval.