The state is planning to leverage technology — especially artificial intelligence — and create a central data lake, integrating information from all departments.
Published May 13, 2025 | 6:28 PM ⚊ Updated May 13, 2025 | 6:28 PM
Andhra Pradesh Chief Minister N Chandrababu Naidu. (X)
Synopsis: Chief Minister Chandrababu Naidu has urged officials concerned to study the revenue pattern over the past few years and suggest ways to replenish the state’s fast-depleting coffers.
With the state coffers fast drying up, the Andhra Pradesh government is not leaving any stone unturned in its bid to augment revenues.
The state is planning to leverage technology — especially artificial intelligence (AI) — and create a central data lake, integrating information from all departments. Each department will have an AI team. These teams will ensure that an AI-driven tax system is in place within the next three months to provide better services to the taxpayer.
This is part of the state government’s exercise to shore up finances as it has many commitments to meet, like the election-eve promises. The officials are looking at improving revenue from the Electronics, IT, and Services sectors to stimulate an increase in revenue sources.
Chief Minister N Chandrababu Naidu, who is concerned about the need to pool up as many resources as possible, has miles to go in implementing his promises as well as big-ticket development projects.
The chief minister, at a review of the status of revenue generation in the state on Tuesday, 13 May, asked all departments to make an in-depth study of the opportunities that could be exploited. He asked them to study the revenue trends of the past three decades to chalk out plans to improve the financial position.
Naidu is of the view that giving a thrust to Electronics, IT, and Services sectors would result in higher revenues.
One important area, hitherto overlooked, is the gold business from which the state could increase its revenues. Naidu pointed out possible leakage of tax revenue in the area of gold trade.
Though Andhra Pradesh ranks among the top states in gold consumption, tax revenues are not commensurate with the volume of business. He asked the officials to plug leakages to shore up revenues.
One of the most important cash cows of the state—the excise department—has been asked to pull up its socks to prevent illegal liquor sales from neighboring states, which are causing a revenue hemorrhage. The chief minister wanted the entire process, from supply to retail, to be tracked in real-time to ensure transparency.
As Andhra Pradesh’s transport revenue remains lower than that of neighboring Karnataka and Tamil Nadu, the state will make an effort to find out what ails the system and put in corrective measures.
Also, the state is looking at monetising red sanders stockpiles worth thousands of crores of rupees. The chief minister suggested that officials form a committee to facilitate the international sale of red sanders stocks in the state.
As Andhra Pradesh is the exclusive habitat for red sanders, the precious wood could turn out to be a potential source of revenue for the state. He wanted the officials to furnish details of the stocks available and their value in the international market.
The revenue target for the financial year 2025–26 from various sources—commercial taxes, excise, stamps and registration, mines, forests, etc.,—has been set at ₹1,34,208 crore, up 29% from the previous year.
Surprisingly, income from the stamps and registration department surged unexpectedly between 1 April and 11 May of this financial year, but revenue from commercial taxes and forests saw a decline.
The central government transfers to the state dropped by 26% during this period compared to last year. While Andhra Pradesh received ₹17,170 crore from the Centre during this period in 2024–25, only ₹12,717 crore was received this year.
The new excise policy unveiled last year has paid off. It has helped the state earn ₹28,842 crore—a 14.84% rise over the previous year.
However, compared to southern states like Telangana, Tamil Nadu, and Karnataka, Andhra Pradesh’s excise revenue remains relatively low. In April 2025 alone, the state earned ₹2,116 crore in excise revenue. Officials estimate that total excise income for the entire year could reach ₹33,882 crore.
Naidu, apparently pining for the loss of Hyderabad during the bifurcation of the undivided state of Andhra Pradesh, pointed out that 75% of Telangana’s revenue comes from Hyderabad, a privilege Andhra Pradesh does not have.
This underscored the need to explore new avenues to enhance revenue. He urged officials to strictly implement the policies introduced over the past year to improve the state’s financial position.
(Edited by Majnu Babu).
