Telangana Chief Minister K Chandrasekhar Rao has blamed the BJP-led Central government for a decline in the state’s revenue by more than Rs 40,000 crore. He accused the Centre of hampering the development of the state with its “politically motivated” policies.

With Rao deciding to hold a week-long session of the state Legislative Assembly to inform the public about the matter, this could well be the new flashpoint in the ongoing political tussle between the TRS and BJP.

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According to a statement issued by the chief minister’s office the state has lost significant revenue in the current financial year due to the “unnecessary” conditions imposed by the Centre. “The Centre was obstructing Telangana from moving forward on the path of development through such measures,” it was stated.

The TRS Government has alleged that at the beginning of the financial year, the Centre had announced that the FRBM limit for Telangana was Rs 54,000 crore. Accordingly the state had prepared its Budget, but now the Centre has reduced FRBM limit to Rs 39,000 crore. Apart from reducing the FRBM limit by 15,000 crore, the Centre has refused to allow Telangana to exercise the additional 0.5 per cent limit of FRBM permitted for financially sound states.

The TRS led government alleged that the Centre has put forward the condition that the state must implement power reforms in order to exercise that 0.5 per cent additional limit of FRBM. The TRS government has so far refused to implement the power reforms arguing that this would mean putting up meters which might be disastrous for the agriculture sector of Telangana which supplies free power to farmers.

The state government further alleged that its refusal to implement power reforms had caused it to lose a total of Rs 21,000 and in addition the Centre also has stopped non Budgetary funds of Rs 20,000 crore due to the state.

It further accused the Centre of stopping funds that the state was raising in the past by entering into loan agreements with various financial institutions. The TRS led government accused the Centre of indulging in conspiracy and undermining federalism and harming the states with its “politically motivated and partisan policies.”