Hyderabad: Financial disputes between Telangana and Andhra Pradesh have surfaced with the delay in distribution of loans of the undivided state. The AP government had recently slapped a notice on TS government to repay its share of loans along with interest amouting to Rs 450 crore taken from the Centre by the government in undivided state.

The TS government replied strongly asking the AP government to submit all the documents first to prove that those funds were utilised in Telangana and it would agree for repayment only if it feels convinced with the proofs.

Not only this, the loan agreements of various funding agencies like World Bank, JICA etc continue to be with AP even eight months after bifurcation. With this, several projects being implemented with the financial assistance in Telangana are being hit leading to a tussle with AP.

The Centre has stepped in to resolve the financial disputes between the states. It has convened a meeting with the officials of both the states in New Delhi on Friday for the purpose. Officials from finance, municipal administration and urban development, and power departments from both the states have been called for the meeting.

The undivided state owes Rs 612 crore loans to Centre. The present AP government has divided the loans between both the states claiming that the funds were spent district-wise. Of the total loans, the AP’s share was arrived at Rs 357 crore and TS’ share at Rs 255 crore. The interest accrued on these loans amouting to Rs 475 crore was also divided with AP getting Rs 277 crore and TS Rs 198 crore. The united state owed Rs 11,000 crore to the World Bank, JICA and other external agencies.

Another Rs 13,000 crore have to be received to implement ongoing projects, which are being allotted to AP government now as and when sanctioned since the agreements continue to be with AP and TS is yet to enter fresh agreements with these agencies.

The Centre has decided to distribute these loans project-wise between the states, wherein the location of the project will be the criterion to decide which state has to bear the loan. The burden on account of foreign aid will be more on Telangana as several projects such as the Outer Ring Road, Hussainsagar cleaning, modernisation of power supply system in the city are located in the capital.