challenges-galore-as-cong-completes-two-years-in-telangana

It has been a mixed bag of hits and misses for the Congress government in Telangana as it completes two years.

 

For Chief Minister A Revanth Reddy, who had steered the party to victory in the December 2023 Assembly elections ending a decade-long rule of the Bharat Rashtra Samithi (BRS), the journey so far has been a roller-coaster ride, with bouquets and brickbats in equal measure.

 

While his government celebrated the occasion by hosting the state’s biggest business conclave, ‘Telangana Rising Global Summit’, to showcase the investment potential and ongoing welfare and development initiatives, there is a growing criticism over unfulfilled poll promises, corruption, political vendetta and deepening financial crisis. 

 

Hype versus delivery

 

Though social welfare and rural development have been the major areas of focus, the alleged loopholes in the execution of ‘Rythu Bandhu’ (financial assistance to farmers) scheme and the failure to fully implement poll promises like Rs 2 lakh crop loan waiver and Rs 2,500 monthly assistance to women under the ‘Mahalakshmi’ scheme have come under the Opposition scrutiny.

 

“High on hype but low on delivery” was how the BRS and other Opposition parties described the government’s performance.

 

Though some of the poll promises like free travel for women in RTC buses, LPG cylinders at Rs 500 for eligible households and free electricity up to 200 units for domestic consumers were rolled out, their implementation has been patchy. 

 

Many other promises like financial assistance to tenant farmers under ‘Rythu Bharosa’ scheme, payment of unemployment allowance and gifting of gold to poor women during their marriage remained unfulfilled.

 

The Congress rode to power on the back of a populist ‘six guarantee’ promise:

1) Mahalakshmi: entails a monthly financial assistance of Rs 2,500 to women; gas cylinders at Rs 500 and free travel for women in RTC buses. 2) Rythu Bharosa: annual financial assistance of Rs 15,000 per acre to farmers and Rs 12,000 to agricultural labourers; a bonus of Rs 500 for paddy per quintal. 3) Gruha Jyothi: 200 units of free electricity for all households. 4) Indiramma Illu: house sites to the poor and Rs 5 lakh financial assistance towards construction of the house. 5) Yuva Vikasam: financial assistance card worth Rs 5 lakh to students which can be used in payment of college fees (in addition to fee reimbursement), coaching fees, foreign college fees, overseas travel expenses, tuition fees, purchase of books and study materials, hostel fees, exam fees. 6) Cheyutha: A monthly pension of Rs 4,000 to senior citizens, widows, disabled, beedi workers, single women, toddy tappers, weavers etc. and health insurance of Rs 10 lakh.

 

Financial crisis

 

While Revanth Reddy has succeeded in consolidating his position in the party, overcoming the initial challenges from within, the biggest challenge before him is to mobilise resources to fund the populist programmes and to strike a balance between welfare and development.

 

His government has inherited a poor financial health, which is deteriorating by the year. Heavy welfare spending and rising committed expenditure are driving much of the fiscal stress.

 

The outstanding liabilities of India’s youngest state are expected to touch Rs 5.46 lakh crore by March 2026, equal to 28.1 per cent of the Gross State Domestic Product (GSDP).

 

But when off-budget borrowings—loans raised by state corporations with government guarantees—are taken into account, the cumulative debt climbs closer to Rs 6.6-Rs 6.7 lakh crore, accounting for nearly 35 per cent of the GSDP.

 

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By August in the second quarter of the financial year 2025-26, Telangana had already borrowed Rs 33,415 crore, exhausting 62 per cent of its annual borrowing limit. The pace of borrowing, combined with sluggish revenues, points to a continuing fiscal stress that can adversely impact the development agenda.

 

Each year, the fiscal deficit has hovered around Rs 49,000-Rs 50,000 crore, indicating a structural imbalance between income and expenditure.

 

Soaring borrowings

 

The government’s dependence on borrowings has only deepened. In 2023-24, net borrowings and liabilities were Rs 49,589 crore. In 2024-25, they stood at Rs 48,322 crore. In just five months of 2025-26, borrowings have already reached Rs 33,415 crore.

 

Revenue receipts continue to fall short of expectations. In 2024-25, the state realised only 76 per cent of its budgeted revenue. In the current year, up to August 2025, it managed just 28 per cent of the annual target.

 

While tax collections are holding at 34 per cent of the yearly target, non-tax revenues are a major weak link. Against a 2025-26 projection of Rs 31,619 crore, non-tax collections stood at a mere Rs 1,578 crore (5 per cent) by August. Grants-in-aid from the Centre have also lagged at just 7 per cent of the year’s estimate.

 

If current trends continue, Telangana risks breaching its annual borrowing ceiling before the close of 2025-26. Servicing debt will take up an even larger share of resources, forcing hard choices between welfare spending and developmental works.

 

Experts have warned that without corrective action, the state may find itself in a cycle where new borrowings are primarily used to service past debt. That would squeeze out investments in infrastructure, health, and education, slowing long-term growth.

 

Politics of vendetta

 

There are also allegations that the government has been resorting to vendetta politics.

 

The Chief Minister has ordered a series of probes aimed squarely at the alleged financial misdeeds and administrative irregularities of the previous BRS government, particularly targeting his predecessor K Chandrasekhar Rao and his son KT Rama Rao, popularly known as KTR.

 

An inquiry has been ordered into the handling of the irrigation sector by the BRS regime, particularly the allegations of corruption in the execution of Kaleshwaram irrigation project. A probe was also ordered into the alleged irregularities in the power sector.

 

The proceedings have been initiated to prosecute KTR for his alleged role in the misappropriation of funds in the Formula E-Race, proposed to be hosted in Hyderabad. The alleged payment of Rs 55 crore to race organisers by the Hyderabad Metropolitan Development Authority (HMDA), authorised solely by KTR in his capacity as the then municipal administration minister, has now become the crux of the case.

 

Controversies

 

The Congress government’s decision to convert a vast stretch of underutilised industrial estates in and around Hyderabad into high-value multi-use commercial zones has triggered a political row.

 

While the BRS and other Opposition parties have dubbed it a ‘mega scam in the making’, the government has framed the move as a path-breaking initiative to transform Hyderabad into a global metropolis. 

 

The government has approved the Hyderabad Industrial Lands Transformation Policy (HILTP) 2025, paving the way for large-scale conversion of ageing industrial estates located within and near the Outer Ring Road (ORR) into high-value, multi-use zones.

 

The policy, cleared through a government order issued recently, aims to unlock thousands of acres of industrial land that have become economically unviable, under-utilised, or incompatible with the city’s rapidly expanding urban core.

 

The establishment of the Hyderabad Disaster Response and Assets Monitoring and Protection Authority (HYDRAA) to remove illegal structures on lake beds, the Musi River Rejuvenation Project, accompanied by the demolition of houses along the riverbank and the controversial land acquisition attempt at Lagacharla in Vikarabad for a pharma cluster sparked protests and provided fresh ammunition to the BRS and BJP.

 

Another big setback for the Revanth Reddy government this year was the order of the Supreme Court striking down its attempts to commercially monetise forest lands within the University of Hyderabad.

 

Political stability

 

When the Congress came to power in December 2023, there were not many hopes that it would survive for long; for, the party had secured a razor-thin margin, winning 64 seats in the 119-member state assembly—only four above the majority mark.

 

Being a relatively new entrant into the Congress, Revanth Reddy had to handle political heavyweights within the party like N Uttam Kumar Reddy, Komatireddy Venkat Reddy and Mallu Bhatti Vikramarka.

 

However, he managed to stabilise his government within months, aided by backing from the Congress high command.

 

In an obvious bid to prevent any dramatic collapse, he managed to lure 10 MLAs from BRS into the Congress. However, the BRS fought a bitter legal battle against these defections and a recent Supreme Court order setting a four-week deadline to adjudicate disqualification petitions may force at least two defecting MLAs to vacate their seats, triggering by-elections.