CAG report proves Revanth Reddy’s interest burden claim to be false, loan burden exaggerated by Congress to cover up own follies

The Congress government’s claims of paying Rs 6,000–7,000 crore monthly as interest on loans taken during the previous BRS regime have been contradicted by official data. The CAG report reveals average monthly interest payments of around Rs 2,300 crore, totalling Rs 9,355 crore in the first four months of FY 2025–26, just 48% of the annual budgeted estimate.

Hyderabad: The Congress government’s repeated claims of being crushed under massive interest payments from loans taken during the BRS regime appear far from reality. Chief Minister A Revanth Reddy‘s repeated claims of shelling out nearly Rs 6000 crore to Rs 7000 crore every month towards interest payments of loans taken during the BRS regime have been proven to be false, with official accounts pegging these payments around Rs 2300 crore per month on an average.

According to accounts upto July 2025, released by the Comptroller and Auditor General, interest payments stood at Rs 9,355 crore for the first four months, against the annual budget estimate of Rs 19,369 crore for the current financial year. This, apart from being around an average of Rs 2,300 crore per month, works out to just 48 per cent of the annual provision, and only a fraction of the State’s total expenditure of Rs 68,823 crore during the four months period.

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Over the last one year, the Congress government has been claiming that it was spending huge funds for debt servicing including nearly Rs 6,000-7,000 crore per month towards interest payments alone. Further, the Congress has been blaming the previous BRS government for obtaining huge loans amounting to over Rs 8 lakh crore which in turn resulted in huge interest payments.

But the latest CAG accounts report prove otherwise. Further, the Centre had also recently clarified in the Lok Sabha that the total outstanding liabilities of the State including loans obtained by various corporations stood at around Rs 3.5 lakh crore when the BRS demitted office in December 2023.

Experts observed that expenditure on interest payments was well within manageable limits. However, they felt that the Congress government was exaggerating the loan burden to cover up its own financial mismanagement and divert attention from falling revenues.

At the end of July, the revenue receipts stood at Rs 50,270 crore which is just 21.88 per cent of the annual target of Rs 2.29 lakh crore. Tax revenues performed relatively better at 27.5 per cent of estimates and recorded Rs 48,145.57 crore against a target of Rs 1.75 lakh crore. However, non-tax revenues (4.2 per cent) and central grants (3.5 per cent) fell drastically short, realising only Rs 1,334 crore and Rs 790 crore respectively.

On the expenditure side, the government spent Rs 68,823 crore by July, or 26.1 per cent of its annual allocation. Revenue expenditure alone consumed Rs 62,835 crore, driven by salaries, pensions, subsidies and interest payments.

The poor capital expenditure remains to be a cause of concern at just Rs 5,988 crore which is 16.4 percent of annual target of Rs 36,504.45 crore. Even compared to last year’s 22.77 per cent for the corresponding period, the State lagged significantly. Borrowings and liabilities so far have reached 45.7 per cent of the annual borrowing limit, pointing to the government’s growing dependence on debt to sustain operations.