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Kerala BJP chief slams state govt claims of inadequate funds allocation by Centre

Thiruvananthapuram: Kerala BJP president K Surendran on Saturday attacked the Kerala government for alleging that the Centre had allocated inadequate funds to the state.

Kerala finance minister K N Balagopal had claimed last month that the state faced a financial crunch due to inadequate allocation of funds by the Centre. K Surendran has said that the BJP government has allocated more funds to the Kerala government than the UPA government did during their two terms.
He also said that whatever the Kerala government was able to provide to the people during the times of Covid was because of the funds allocated by the central government only.

Surendran blamed the Kerala government for taking more loans to meet their expenses.
Other than this, the Kerala BJP President also alleged that irregularities worth thousands of crores have taken place in cooperative banks of Kerala. Surendran was speaking at a protest against the Kerala government demanding to protect Kerala cooperative bank sector.

This comes after last month, Kerala finance minister K N Balagopal had written to Union Finance Minister Nirmala Sitharaman about Kerala undergoing a financial crisis. He claimed that this was happening because Kerala has not received its due GST compensation of Rs 12,000 crore.

"The financial health of the state has been seriously affected by a reduction in the revenue deficit grant to the tune of around Rs 7,000 crore this year and loss due to stoppage of GST compensation of around Rs 12,000 crore. In addition, the Ministry of Finance has arbitrarily, in the name of off-budget borrowing made a reduction of about Rs,4000 crores in the net borrowing limits of the State. In all the State Government will have to contend with a reduction of Rs 23,000 crore in the financial resources available to it for financing the budget in the current financial year," said Balagopal in the letter.

He had then said that this financial crunch is leading to difficulty in the continuation of welfare schemes for the poor. He had requested the Centre to realize this.

"The composition of the financial liabilities of state governments has changed significantly in the last 25 years. The share of loans and advances from the Centre has declined from over 15.8% of all state liabilities in 2005 to 3 per cent in 2020. Kerala is no exception to this trend. The outstanding loans and advances from the Centre to Kerala State as a percentage of Kerala State's total liabilities have reduced from 12.4% in 2005 to 3.3% in 2020," he had then said in the letter.

The Kerala finance minister further wrote that under the declared objective of fixing the net borrowing ceiling for states, Article 293(3) of the Constitution was being used to vitiate their independence and affect their financial autonomy. (ANI)

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