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Union Budget: Kerala Finance Minister seeks Rs 24,000 cr special package, approval for SilverLine project | Kerala News
Thiruvananthapuram: Kerala Finance Minister KN Balagopal on Saturday appealed to the Center to announce a special package of Rs 24,000 crore for the state in the upcoming Union Budget 2024-25 “to overcome the current liquidity stress”. This request was made during a pre-budget discussion held in Delhi, attended by Union Finance Minister Nirmala Sitharaman and Finance Ministers of various states.
Balagopal highlighted that Kerala, which has been grappling with the fallout of repeated floods and the COVID-19 pandemic, is facing significant liquidity stress. He alleged that the state is having difficulty managing its finances to meet its obligations due to factors such as reduced share of divisible pool, lower revenue neutral rate after implementation of GST, cessation of GST compensation and revenue shortfall subsidies and new restrictions on loan limits.
Balagopal highlighted that the State took all possible measures to increase its own tax and non-tax revenues, but despite these efforts, the government “was going through a very serious liquidity crisis”. The Kerala Finance Minister referred to the State’s contributions in various spheres including start-up and innovation, human development index (HDI) and sustainable development goals (SDGs) to maintain national pride.
“Considering the state’s contribution in various spheres towards maintaining national pride which includes but not limited to HDI, SDG, startup and innovation, a special package of at least Rs 24,000 crore may be announced in the Union Budget 2024-25 to monitor the current liquidity stress, scheduling it for a period of 2 years, from 2024 to 2025,” he said in his speech at the discussion.
Urging the Union government to review the restriction on open market borrowing, he said the state was currently borrowing at much lower levels compared to the limits set for it. “It is due to the changes introduced in the calculation of the debt ceiling, such as the inclusion of public accounts and loans from state-owned companies. Therefore, this policy has to be reversed.” year and the next fiscal year.
This is due to the introduction of a new measure by the Union government, with retroactive effect, to reduce the State’s borrowing limit for KIIFB and Pension Company loans made in the year 2021-22,” he said. the prejudicial decision with retrospective effect needs to be reversed.”
The Minister also highlighted that Kerala was unable to benefit from the welcome CAPEX mechanism announced in the previous Union budgets, which allowed the State to utilize the fund beyond the normal borrowing limit and on concessional terms. Balagopal, in his speech, also said that Kerala was looking forward to a “substantial jump” in the state’s capital expenditure.
About Vizhinjam International Mother Port, he said it was a revolutionary project for the country as a whole.
Therefore, in addition to a direct investment from the Union government, the state also urgently needed a special capital investment of Rs 5,000 crore to fulfill Kerala’s share in the development of the port and the surrounding region. Balagopal also requested another Rs 5,000 crore to fund some other infrastructure projects such as the ‘tunnel road link between Calicut and Wayanad’.
Press for SilverLine project approval
The minister stated that the state’s railway infrastructure was on the verge of collapse due to the growing imbalance between traffic load and infrastructure. “Therefore, we urge the Union Government to increase central funding for the development of transport infrastructure, including roads, railways, metro and ports, as well as urban infrastructure projects in cities and towns. “Kerala also needs additional rail services, as many residents work in other states and a significant number of people travel to Kerala in search of employment and tourism,” he added.
He, therefore, sought advance clearance of the semi-high speed railway line project – Silverline – which is pending approval from the Centre. The minister also said that Kerala was the only state that spent 25 per cent of the land acquisition cost for widening the National Highway, which amounted to around Rs 6,000 crore. “Kerala’s efforts to develop infrastructure and improve social services have intensified many times over in recent years, helping the state achieve substantially higher standards in social and economic sectors, which in turn has contributed to progress general of the country.”
Apart from these, several pending demands of the state such as establishing an AIIMS in Kerala, starting an International Ayurvedic Research Institute in Kannur, increasing the minimum support price of rubber to Rs 250 and changing the sharing mechanism of GST revenue from the current ratio of 50:50 The ratio of 60:40 in favor of state governments was also raised in the discussion.
“I hope that the next Union Budget considers these suggestions and the long-pending demands of the state of Kerala. I hope that the Union Budget can present a macroeconomic policy and fiscal consolidation measure with a view to upholding the true spirit of cooperative federalism” , he said. he said.
(With PTI inputs)