Govt to open RBI account for Telangana state
Hyderabad: As part of bifurcating Andhra Pradesh, the State government directed its finance department secretary L Premachandra Reddy to enter into agreement with Reserve Bank of India, Mumbai on behalf of Governor, State of Telangana for opening the new account for carrying out the banking business as well as public debt.
Opening of an account with the Reserve Bank of India is essential to carry out the financial transactions through the banks. The State government issued an order, directing the finance department secretary to complete the formalities in this regard.
According to section 44 Act, the Governor of existing State of Andhra Pradesh is authorised to incur expenditure from the consolidated fund of the State of Telangana for any period not exceeding six months beginning with appointed day, pending sanction of such expenditure by the Legislature of the State of Telangana.
Further, as per section 49 of Andhra Pradesh Reorganisation Act 2014, 'the total of the cash balances in all treasuries of the existing State of Andhra Pradesh and the credit balances with Reserve Bank of India, State Bank of India or any other bank immediately before the appointed day shall be divided between two states on the basis of population ratio'.
The Union government requested the Reserve Bank Governor for opening the accounts for the new State of Telangana to finalise agreements.
As per the rules, there shall be an agreement between the State Governor and Reserve Bank of India for opening the new account consisting of Consolidate Fund, Contingency Fund and Public Account of the State.
News Posted: 25 April, 2014
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