Southern states revenue discrimination reflects political bias: Thummala Nageswara Rao
Hyderabad: Telangana Agriculture Minister Thummala Nageswara Rao said southern states were facing sustained economic injustice under the Centre’s financial policies, terming it political bias rather than an economic imbalance.
He said the Union government continued to speak about “Viksit Bharat” while maintaining discriminatory practices against southern states, particularly Telangana. According to him, such policies ran contrary to the principles of cooperative federalism.
Between 2018–19 and 2022–23, the Centre collected ₹90.80 lakh crore in total taxes across the country. During this five-year period, southern states contributed more than ₹22.86 lakh crore, accounting for over one-fourth of total collections.
Despite this significant contribution, the Centre returned only 16.3 per cent of funds to southern states, he said. This pattern, he added, amounted to a clear violation of fiscal equity.
A rupee-by-rupee comparison, he said, exposed the Centre’s double standard. Southern states received an average of just 30 paise for every rupee paid as tax. Meanwhile, states such as Bihar and Uttar Pradesh received nearly ₹4 per rupee.
He warned that southern states revenue discrimination would widen fiscal imbalance and fuel divisions between regions. Penalising high-revenue states while incentivising low-collection states, he said, had become a dangerous policy trend.
Southern states revenue discrimination highlighted by Telangana data
Referring to answers given in Parliament in December, the minister said Telangana contributed ₹1,33,208 crore in taxes during 2024–25. Against this amount, the Centre released ₹27,050 crore as tax devolution, ₹7,913 crore as grants, and ₹16,762 crore through centrally sponsored schemes.
Together, these releases totalled ₹51,725 crore. However, he clarified that this figure included scheme-bound allocations, while funds freely usable by the state were far lower.
He said GST-related changes alone caused Telangana an annual loss of about ₹8,000 crore. Additionally, the 16th Finance Commission set aside revenue deficit grants recommended earlier, weakening states’ financial autonomy.
Cuts to sector-wise and special grants could further result in losses of up to ₹5,000 crore for Telangana, he warned.
Calling the issue political rather than technical, the minister said the Centre appeared intent on weakening financially strong states and forcing economic dependence. He alleged that discrimination was sharper against non-BJP-ruled southern states.
He said states were equal partners in the federal system, not dependents on Central discretion. Fair treatment of revenue-generating states, he added, remained essential for national development.
The minister criticised BJP MPs and Union ministers from Telangana for failing to raise the issue over the past decade. He alleged that funds for national highways were being projected as state assistance, even as toll charges were collected from the public.
He said Telangana continued to spend heavily on farm loan waivers, Rythu Bharosa, crop procurement, irrigation projects, and free power. Denial of a fair Central share, he said, had become a major obstacle to the state’s economic growth.
He said none of Telangana’s proposals were accepted in the Union Budget. Continued political punishment of the state, he warned, would reduce “Viksit Bharat” to a slogan. He urged BJP leaders from Telangana to join the demand for the state’s rightful share.