Southern states have placed their demands as Union Finance Minister Nirmala Sitharaman is set to present her eighth Budget on Saturday, 1 February.
Published Jan 31, 2025 | 7:47 PM ⚊ Updated Jan 31, 2025 | 7:47 PM
Nirmala Sitharaman. (X)
Expectations are high even as Finance Minister Nirmala Sitharaman is set to make her eighth Budget — second full-fledged in Modi 3.0 — speech on Saturday, 1 February.
The middle class across the country will be looking forward to some tax reliefs, while Corporate India hopes for tax reforms, lower GST rates, regulatory updates, and various CapEx allocations.
Down south, the states are expecting state-specific announcements from Sitharaman as she rises to make the speech, likely at 11 am. None of the southern states has robust financial health, and all are looking forward to some relief to tide over the crises they are in.
Kerala’s Finance Minister KN Balagopal is expecting the Union minister to announce a ₹24,000-crore special package to overcome the cuts in central allocations. The decreased allocations have put Kerala in a financial crisis.
Additionally, the state has urged the Centre to provide a ₹2,000-crore special package for Wayanad, battered by a series of devastating landslides on 30 July 2024. It is also expecting a ₹4,500-crore allocation for undertaking climate change-related initiatives.
Kerala has also sought ₹5,000 crore for the Vizhinjam seaport project, besides support for generating jobs in the state.
The state, which has been witnessing a spurt in man-wildlife conflicts, has requested a ₹1,000-crore special assistance for managing the rising incidents. It also requires an annual Budget provision of ₹300 crore for supporting non-resident Keralites, and a special ₹2,000-crore package for meeting the needs of returning migrants.
Besides hikes in the minimum support prices (MSP) for paddy and copra, Kerala has demanded the rollout of the SilverLine semi-high-speed rail project, the Nilambur-Nanjangud, Thalassery-Mysuru, and the Angamaly-Sabari railway lines. Kerala is also expecting the minister to announce an AIIMS for the state.
Karnataka has categorically demanded the Union government to approve the state’s key projects. “Karnataka’s growth can’t be put on hold—Union Budget 2025 must clear these projects,” Chief Minister Siddaramaiah said in an X post.
The schemes awaiting clearance included the Mekedatu project envisaged to supply drinking water to Bengaluru, the Kalasa-Banduri drinking water project for North Karnataka, and the Upper Bhadra project, meant to irrigate 2.25 lakh hectares of farmland.
Tamil Nadu, which has been demanding a fairer share of central resources from the divisible pool of taxes, has now demanded a 50 percent share. Like other southern states, barring Andhra Pradesh, the state, too, has been wondering why the Centre was punishing progressive states instead of rewarding them.
Like Kerala, Tamil Nadu, too, has asked for more funds to face recurring natural calamities. At the pre-Budget meeting in December, state Finance Minister Thangam Thennarasu said the increased frequency of weather systems, resulting in some areas receiving an entire year’s rainfall in 24 hours.
Pointing out the inadequate State Disaster Response Fund, the minister sought ₹6,675 crore from the NDRF. However, this demand is not likely to be met since Sitharaman had earlier clarified that the NDRF cannot be tweaked for the sake of a few states.
Public transport is another area for which Tamil Nadu has sought central assistance. It has sought additional funds for the Chennai Metro Phase II, a new railway line between Thambaram and Chengalpattu, and a semi-high-speed rail corridor connecting Chennai with Salem and Coimbatore. This corridor, Tamil Nadu argued, would augment the industrial sector.
For the Chennai Metro Phase II, Tamil Nadu has sought an allocation of ₹10,000 crore in this Budget, and ₹16,000 crore next year.
Tamil Nadu has also sought ₹2,152 crore for the Samagra Shiksha Abhiyan. Terming the fund crucial for the functioning of schools across the state, Tamil Nadu has urged the Centre to release it at the earliest. The Union government has been withholding the funds since Tamil Nadu has not adopted the National Education Policy.
The cash-strapped Congress government in Telangana is seeking ₹1.63 lakh crore for multiple infrastructure projects, including Chief Minister A Revanth Reddy’s Musi Riverfront Rejuvenation Project.
Telangana is also hoping for an end to the financial issues with Andhra Pradesh that arose after the enactment of the Andhra Pradesh Reorganisation Act in 2014.
The state has proposed the Centre to jointly roll out the Hyderabad Metro Phase II at a cost of ₹24,269 crore. The Metro expansion would cover another 76.4 km. For the Musi Riverfront project, the state has requested ₹14,100 crore.
Telangana has also asked the Centre for the release of pending grants amounting to ₹1,800 crore. The state has also requested the Centre to intervene in addressing the ₹2,547.07 crore loans for which it is made accountable following the bifurcation of Andhra Pradesh.
At a recent TDP meeting at his residence, Andhra Pradesh Chief Minister N Chandrababu Naidu asked party MPs to prioritise the state’s interests and work towards securing funding for key projects in the Union Budget.
Naidu advised the MPs to come forward for pending issues under the Andhra Pradesh Reorganisation Act.
Andhra Pradesh is expecting more funds for the Polavaram and Amaravati works. The state also needs funds for building ports that could create employment and wealth.
The NDA government in the state is expecting the Centre’s backing for metro rail projects in Visakhapatnam and Vijayawada, besides funding for the Godavari-Banakacherla project, which Naidu termed a “game changer” in making the state drought-free.
