According to LDF, a total of ₹9,267.6 crore has been cut or denied to Kerala under various heads, severely impacting key sectors.
Published Jan 12, 2026 | 2:20 PM ⚊ Updated Jan 12, 2026 | 2:20 PM
Kerala CM Pinarayi Vijayan at the satyagraha. Credit: x.com/PRajeevOfficial
Synopsis: Kerala Chief Minister Pinarayi Vijayan led a day-long satyagraha in capital Thiruvananthapuram accusing the Centre of hostile fiscal policies, and opposition UDF being in cahoots. LDF leaders cited cuts and denials amounting to over ₹9,000 crore, impacting welfare and development schemes. Calling the actions politically driven, they vowed continued resistance, with statewide campaign marches planned to culminate on 16 February.
Kerala Chief Minister Pinarayi Vijayan on Monday, 12 January, accused the Centre of adopting a “hostile attitude” towards the State and alleged that the UDF was implicitly supporting this approach, as he inaugurated a day-long satyagraha protest in front of the Martyrs’ Square at Palayam in Thiruvananthapuram.
Addressing the protest, Vijayan said the Centre and its supporters were acting with the mindset that Kerala should not move forward as long as the LDF remained in power.
The agitation, being held from 10 am to 5 pm, was described as a fight for the State’s legitimate needs and rights. Ministers, MLAs, and senior LDF leaders are also participating in the protest.
“The protest is being held for the needs of Kerala. The demand is that this country should not be destroyed and that Kerala should not be denied what it deserves,” Pinarayi said, adding that the State was not seeking anything beyond what was rightfully due to it.
He called upon all those concerned about Kerala’s future to raise their voices collectively against what he termed continued neglect.
“Unfortunately, some sections in Kerala are not ready for this. Both BJP and the Congress are supporting the Centre’s hostility towards Kerala. This is a very unfortunate stance,” he said, explaining why LDF had intensified its agitation.
The satyagraha marks a continuation of the high-profile protest staged by Vijayan and his Cabinet colleagues at Jantar Mantar in New Delhi in February 2024, when LDF accused the Centre of imposing a “crippling financial embargo” on Kerala.
The front has since repeatedly alleged that politically motivated fiscal constraints are being imposed on the state. Earlier, LDF cited a series of figures to underline the scale of what it calls the Centre’s neglect.
Of the ₹12,000 crore loan sanction Kerala expected in the last three months of the current financial year, ₹5,900 crore was cut in a single instance. Kerala’s overall borrowing limit was allegedly reduced by ₹17,000 crore by excluding certain budget items.
Permission was also denied for a ₹6,000 crore loan linked to Kerala’s expenditure on land acquisition for national highway development.
In addition, ₹965 crore due to the State was recovered by the Centre in the name of IGST settlement, while a ₹3,300 crore loan was denied citing guarantee deposit norms. Kerala is also awaiting around ₹5,784 crore under various centrally sponsored schemes, including paddy procurement, Samagra Shiksha Kerala, the Jal Jeevan Mission and UGC-related benefits.
Despite these constraints, LDF maintained that Kerala has remained on a steady development path due to what it described as prudent fiscal management. It pointed out that the state’s own revenue increased from ₹54,000 crore in 2015-16 to ₹1,03,240 crore, while per capita income rose from ₹1,66,246 in 2016 to ₹3,08,338.
Kerala’s debt, at 24.88 percent of gross state domestic product, is lower than the national average of 26.11 percent.
Terming the Centre’s actions as politically driven, LDF said it would continue to resist any move that undermines welfare and development programmes, including women’s safety initiatives, the Connect to Work scholarship scheme and welfare pensions.
Responding specifically to Union Home Minister Amit Shah’s claim that Kerala received a larger share of central funds under the Modi government, Chief Minister Pinarayi Vijayan said the statement distorted both facts and constitutional principles.
He said that tax devolution through the Finance Commission is not a “charity” granted by the Centre, but a constitutional entitlement of States, drawn from taxes collected from their own people. Pinarayi pointed out that Kerala’s share in central taxes has, in fact, declined during the tenure of the 15th Finance Commission.
While the state received ₹16,833 crore and ₹19,038 crore in 2017-18 and 2018-19 under the 14th Commission, the allocation dropped sharply to ₹11,560 crore in 2020-21 under the 15th Commission.
Though there was a partial recovery in subsequent years, he said the overall trend marked an unprecedented reduction in Kerala’s relative share.
He stressed that a crucial component of the 15th Finance Commission’s transfers—the Revenue Deficit Grant—was secured only after strong opposition from States, including Kerala, to an initial proposal that sought to deny such special assistance altogether. “Even this grant is not generosity, but our rightful due,” he said.
The CM also cited former senior PMO official and current NITI Aayog CEO BVR Subramanian to allege that PM Modi had exerted pressure on the Finance Commission to reduce states’ tax share from the recommended 42 percent to 33 percent, undermining its constitutional autonomy.
“These facts have never been denied,” Pinarayi said, calling on Amit Shah to clarify them instead of making misleading claims.
Pinarayi said the agitation was a warning that Kerala would not accept attempts to “suffocate” it financially, and called for united resistance against what he termed a coordinated political and economic offensive against the state.
Earlier, LDF convener TP Ramakrishnan called upon “all people who love the country and Kerala” to participate in a series of agitation programmes under the leadership of the LDF State Committee, demanding that the Centre withdraw what he described as vendetta-driven actions against the state.
Ramakrishnan alleged that the Union government was deliberately withholding statutory dues and slashing allocations to cripple Kerala’s welfare programmes.
According to LDF, a total of ₹9,267.6 crore has been cut or denied to the state under various heads, severely impacting key sectors.
He said arrears include ₹1,344 crore towards paddy procurement incentives, ₹1,066.36 crore under the Samagra Shiksha Abhiyan (SSA), ₹341 crore as the Centre’s share of social security pensions, and ₹650 crore under the Jal Jeevan Mission.
Changes introduced by the Centre in the MGNREGS have imposed an additional financial burden of ₹3,544 crore on Kerala, he added.
Besides these, the state is still awaiting the release of arrears amounting to ₹6,947.36 crore, the LDF claimed.
“These steps are aimed at obstructing the welfare schemes announced by the state government and sabotaging Kerala’s development,” Ramakrishnan charged, accusing the Centre of gross negligence in releasing funds legitimately due to the state.
Meanwhile, Industries Minister P Rajeev said, “This is not a battle between political parties but a fight for the dignity, development and welfare of our people. When funds meant for welfare schemes, workers and public services are blocked, democracy must raise its voice. Kerala refuses to be silenced. We stand united for federal justice, economic fairness and the future of our state. This struggle is for every citizen of Kerala and we will continue to resist with strength and resolve.
Kerala is protesting today against the Union Government’s politically motivated attempts to stifle our growth and deny us our rightful share. This is not a battle between political parties but a fight for the dignity, development and welfare of our people. When funds meant for… pic.twitter.com/1gD0hQhKeb
— P Rajeev (@PRajeevOfficial) January 12, 2026
In addition to senior LDF leaders, prominent personalities from socio-cultural spheres are also expected to take part.
The LDF has also decided to organise three statewide vehicle campaign marches to “expose the wrong policies and vindictive approach of Centre” and to communicate what it describes as the alternative development vision of the LDF government.
These marches will culminate on 16 February.
(With inputs from Dileep V Kumar. Edited by Amit Vasudev)
