The left-wing government of Kerala has once again sought financial assistance from the central government. The state, grappling with economic challenges attributed to the mismanagement by both the Congress and left-wing administrations, has made an appeal for a special package of Rs 24,000 crore. Kerala has emphasised that this package is essential to addressing its ongoing economic crisis.
According to media reports, Kerala’s Finance Minister, KN Balagopal, put forward this request on Saturday, June 22, 2024, during a pre-budget meeting in New Delhi. This meeting, held before the introduction of the new government’s comprehensive budget, involved discussions with various states, including Kerala.
Minister Balagopal has underscored the need for a two-year financial support plan to help Kerala navigate through its economic difficulties. Besides the Rs 24,000 crore package, the state has also sought an additional Rs 5,000 crore specifically for the development of the Vizhinjam Port.
Furthermore, Kerala has requested permission to increase its market borrowings to manage its expenditures effectively. The state government has identified the current borrowing constraints as a significant factor contributing to its financial woes. In addition to these requests, Kerala has presented several other demands to the central government.
Kerala’s plea for the Rs 24,000 crore economic package follows closely on the heels of recent aid from the central government. Just a month ago, the Modi administration granted Kerala permission to borrow an additional Rs 21,253 crore, a relief measure set to remain in effect until December 2024.
Similarly, Karnataka, a Congress-ruled state, has requested a special package of Rs 11,000 crore from the central government. For the fiscal year 2024-25, Karnataka plans to allocate Rs 52,000 crore towards electoral guarantees. The Karnataka Congress government has specifically asked for Rs 11,495 crore from the central government. In an effort to boost the state’s revenue, Karnataka recently engaged an American agency, paying Rs 9.5 crore for six months of consultancy services.
In light of the financial strain caused by free schemes, the Karnataka Congress government had previously used Rs 11,000 crore allocated for SC/ST programs. Additionally, they are contemplating increases in water charges and bus fares to mitigate economic pressures. Recently, the state also raised the prices of petrol and diesel.
Similarly, Tamil Nadu’s Finance Minister Thangam Thenarasu requested a budgetary allocation of Rs 63,000 crore for Chennai Metro Rail’s second phase, which has been pending clearance from the Cabinet Committee on Economic Affairs (CCEA) for three years. He also sought funds for other projects and emphasized the need for financial assistance for disaster relief efforts.
Also, Andhra Pradesh and Chhattisgarh sought assistance for developing new state capitals, while Tamil Nadu, Haryana, and Odisha requested project-specific support.
The 18th Lok Sabha is scheduled to commence its sessions on June 23, marking the beginning of a new legislative term in India’s parliamentary history. This session is particularly significant as it will set the tone for the newly elected members of Parliament (MPs) and the legislative agenda for the upcoming term.
