The Andhra Pradesh government, led by Chief Minister N. Chandrababu Naidu, is set to clear ₹7,500 crore in outstanding subsidy dues. This move is aimed at attracting private investments to the state and boosting economic activity. The initial payment of ₹2,000 crore is scheduled for October, with the remaining amount to be disbursed by the end of December. To facilitate these payments, a new corporation will be established to raise the necessary funds.
The government's priority will be to support employment-generating Micro, Small, and Medium Enterprises (MSMEs). This decision underscores the government's commitment to fulfilling promises made during the elections and addressing the state's financial challenges. Finance Minister Payyavula Keshav has acknowledged the severe financial crunch but emphasized the government's determination to overcome these impediments.
This isn't the first time the Chandrababu Naidu government has addressed pending dues. Recently, Naidu approved the clearance of ₹110 crore in diet charges and ₹20.5 crore in cosmetic charges for BC Welfare hostels, which had been pending from the previous YSRCP government. Furthermore, the government released ₹2 crore to disburse money to weavers from whom the Andhra Pradesh State Handloom Weavers Cooperative Society (APCO) had purchased clothes.
In January 2025, the government cleared dues amounting to nearly ₹6,700 crore to various sections ahead of Sankranti. This included payments towards GPF, leave encashment for employees, fee reimbursement for students, payments to small contractors, and dues to MSMEs. The distribution companies (DISCOMs) also received ₹500 crore towards reimbursement of subsidies.
In April 2025, the government agreed to release ₹12,939 crore to DISCOMs towards subsidies for various sectors, including agriculture, for the fiscal year 2025-26. An initial ₹4,470 crore was released for the first quarter, with the balance to be disbursed in subsequent spells. Energy Minister Gottipati Ravi Kumar stated that this commitment aims to prevent DISCOMs from falling into debt, a situation he attributed to the previous YS Jagan Mohan Reddy regime.
The Naidu government has also focused on clearing dues related to BC students' welfare. In February 2025, Chief Minister Naidu directed officials to clear all pending dues related to student diet charges, hostel maintenance, and educational facilities. This included tutor honorariums, diet charges, and expenses for cosmetics and hygiene in hostels.
Moreover, the government is actively promoting micro-irrigation to reduce costs for farmers. Chief Minister Naidu has instructed the revival of the 90% subsidy on drip irrigation to maximize farmer benefits. The Andhra Pradesh Micro Irrigation Project (APMIP) has been launched to streamline the implementation of micro-irrigation technologies.
Agriculture Minister K. Atchannaidu highlighted the government's commitment to improving the conditions of fishermen. The coalition government cleared ₹16 crore in diesel subsidy dues left pending by the YSRCP, with a further ₹7 crore paid recently.
These efforts to clear pending dues reflect the Chandrababu Naidu government's focus on fiscal responsibility, welfare, and economic development in Andhra Pradesh.
