The Modi-led NDA central government will allocate Rs 20,000-30,000 crore funds under the "Special Assistance under the demand-Transfers to states" category to Andhra Pradesh and Bihar in 2024-25 as per the Business Standard report.
Financial assistance of Rs 15,000-20,000 crore for N. Chandrababu Naidu led Andhra Pradesh government and Rs 5,000-10,000 crore for Nitish Kumar led Bihar government is expected in FY25.
Finance Minister Nirmala Sitharaman raised the funds' allocation from Rs 4,000 crore in the interim budget to Rs 20,000 crore in the general budget under the "Special Assistance under the demand- Transfers to states". The raise will help to fund infrastructure projects in Andhra Pradesh and Bihar.
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The fund allocation will likely be used to finance development projects in both states. Sitharaman said in her budget speech, "Our government is fully committed to financing and early completion of the Polavaram Irrigation Project, which is the lifeline for Andhra Pradesh and its farmers. This will facilitate our country's food security as well."
As per the Andhra Pradesh Reorganisation Act, the allocated grants will be used for the development of backward regions of Rayalaseema, Prakasam, and North Coastal. Essential infrastructure like water, power, railways and roads in Kopparthy node on the Vishakhapatnam-Chennai industrial corridor and Orvakal node on the Hyderabad-Bengaluru industrial corridor will be financed.
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The additional fund for the state of Bihar will help build new airports, medical colleges, and sports infrastructure as announced by the FM. Around Rs 26,000 crore will be used to develop the four road connectivity projects; Patna-Purnea Expressway, Buxar-Bhagalpur Expressway, Bodhgaya, Rajgir, Vaishali and Darbhanga spurs, and two-lane bridge over Ganga river at Buxar. To increase the rate of industrial development in Bihar the fund will used to build an industrial node at Gaya.
FM also announced Rs 21,400 crore for setting up a new 2400-megawatt power plant at Pirpainti in the Bhagalpur district of Bihar. The centre in the budget also promised an irrigation and flood mitigation programme worth around Rs 11,500 crore for Bihar.
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