Kerala Kerala Finance Minister K N Balagopal on Thursday met Union Finance Minister Nirmala Sitharaman and put forth demands such as special package and approval of more borrowing for the state. During this, a detailed memorandum was submitted to Sitharaman about Kerala’s demands. In the memorandum, Balagopal said that Kerala is on the path of fiscal strength, but it is facing a serious financial crisis due to the reduction in revenue transfer from the Center and restrictions related to borrowing. After the meeting, Balagopal told reporters that this was a courtesy meeting after Sitharaman took over as Finance Minister after the Lok Sabha elections.
Kerala has a very good record in terms of fiscal strength
He said that Kerala has a very good record in terms of fiscal strength. The state has demanded a special package of at least Rs 24,000 crore in the Union Budget 2024-25 to deal with the current cash crisis. This package is to be completed in a period of two years from 2024-25. Another demand of Kerala is for special assistance for Vizhinjam International Port.
Special capital investment of Rs 5,000 crore needed
According to the memorandum, “Apart from direct investment from the Central Government, we urgently need special capital investment support of Rs 5,000 crore to fulfil our obligations in the development of the Vizhinjam port area. We also request Rs 5,000 crore to finance some other infrastructure projects, such as ‘tunnel road link between Calicut and Wayanad’.
There will be a loss of Rs 4,710 crore
According to the memorandum, due to the restrictions imposed by the Centre on raising loans, Kerala will suffer a loss of about Rs 4,710 crore in the current and next financial year. According to the memorandum, “Kerala has repeatedly requested the Centre to reconsider this and stop cutting this amount from the borrowing limit at least for this financial year and the next financial year. Therefore, permission to borrow Rs 4,710 crore may be given in addition to the borrowing limit being fixed for these two years.”
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