Faced with a severe financial crisis, the Andhra Pradesh government has appointed Subhash Chandra Garg, former Union finance secretary, as an advisor to chief minister YS Jagan Mohan Reddy to deal with resource mobilisation in the finance ministry.
A government order, issued late on Sunday, said the former Union finance secretary has been given the rank of a cabinet minister in the state government. Garg would be in the post for a period of two years.
Garg’s appointment to look into resource mobilisation comes amid a severe shortage of finances that the Andhra Pradesh government is facing in funding its welfare schemes under the “Navaratnalu” (nine promises) programme.
It had to divert nearly Rs 6100 crore from various departments to fund the flagship programme of “Amma Vodi” to provide financial assistance to mothers for sending their children to schools.
State finance minister Buggana Rajendranath Reddy said the state share of Goods and Services Tax (GST) returns from the Centre had come down by about Rs 2500 crore for 2018-19.
Moreover, the Centre had paid only Rs 3979 crore towards revenue deficit compensation as against Rs 18,969 crore and only Rs 1050 crore towards development of backward districts, as against the promised amount of Rs 3979 crore.
On Monday, the chief minister held an official review meeting on Mission Build programme, aimed at additional resource mobilisation through monetisation of vacant government lands through National Building Construction Corporation.
Jagan Reddy directed that the officials identify the government lands and sell them for funding development and welfare schemes.
Against this backdrop, the government would utilise the services of Garg in finding methods for additional resource mobilisation.
The order said Garg, in the capacity of advisor to the chief minister, shall spend 15 days in a month on the assignment including 7-10 days at the state headquarters.
A 1983-batch Indian Administrative Service (IAS) officer of Rajasthan cadre, Garg took voluntary retirement in October 2019, after he was suddenly shifted out of the Union finance ministry and transferred to the department of energy in July for allegedly proposing to raise sovereign bond overseas in external currencies.
Garg also pushed for a one-time transfer of the Reserve Bank of India’s (RBI) reserves to the government in the meetings of the Bimal Jalan committee looking into the capitalist economic framework.
According to an official release from the chief minister’s office, Garg has an illustrative career of more than 36 years in areas such as finance, investments, international business, fintech etc.
Garg served as the finance secretary of the Rajasthan government and later, moved to the Centre as the director in the department of economic affairs under the finance ministry in 2000.
He handled the matters connected with the World Bank Group and International Monetary Fund (IMF) for more than three years.
He was India’s executive director in the World Bank Group for Bangladesh, Bhutan, India and Sri Lanka from November 2014 to July 2017. He made a contribution to refashioning several financing policies of the World Bank.