Published Dec 11, 2023 | 4:49 PM ⚊ Updated Dec 11, 2023 | 11:15 PM
An image from the meeting of Opposition bloc INDIA. (X)
MPs from various parties of the INDIA bloc staged a walkout in the Rajya Sabha on Monday, 11 December, alleging a “blockade” of funds to Opposition-ruled states.
The MPs from the Congress, DMK, CPI(M), CPI, Aam Aadmi Party (AAP), Trinamool Congress (TMC), Samajwadi Party (SP), Janata Dal (United), Rashtriya Janata Dal (RJD), Nationalist Congress Party (NCP), and Shiv Sena (Uddhav Balasaheb Thackeray), among others, staged the walkout.
“All Opposition parties walked out of the Rajya Sabha this morning, protesting against the Union government’s economic blockade of funds to states run by non-BJP parties,” TMC MP Derek O’Brien said.
Several states ruled by Opposition parties, including Kerala, Karnataka and Telangana have been accusing the Union government of crippling them financially by not providing them with GST monies, cutting down borrowing limits, and non-allotment of funds under several heads.
On 7 October, Kerala Finance Minister KN Balagopal wrote to Union Finance Minister Nirmala Sitaraman stating that the liquidity stress was now aggravated in the state specifically because of the cut in the annual borrowing ceiling for the financial years 2022-23 and 2023-24.
He sought the intervention of Nirmala Sitaraman on the issue.
He further said Kerala had been relying on its own sources of revenue for meeting the expenditure during recent years, unlike many other states.
Balagopal said the decision of the Union Government to include the borrowing of institutions like KIIFB (Kerala Infrastructure Investment Fund Board) and lower the annual borrowing limit of the state with retrospective effect was causing severe liquidity stress for Kerala.
In May, post the cuts, the state government had requested the Union government to fix the borrowing limit at ₹22,000 crore. Balagopal said the BJP government was attempting to strangle the state financially, and in the process, the less privileged in the state were getting targeted.
He felt the Union government has made it a practice to deny or reduce grants and loans required by Kerala — a challenge to the people of the state.
The ultimate aim of the Union government is politics, and it wants to halt the developmental and welfare activities in Kerala, which has become a model for the entire nation, he said.
Speaking to South First in May, he said, that the Union government had set Kerala’s borrowing limit at ₹15,390 crore, much below what the state was expecting.
Karnataka Revenue Minister Krishna Byre Gowda, in an recent interview with South First, said the needs of the state were almost totally ignored by the Union government in the 15th Finance Commission. However, he is hopeful that the problems will be fixed in the upcoming Finance Commission.
“Karnataka was probably at the top of the hit list in the decision-making of the 15th Finance Commission. We hope some of those injustices will be rectified in the 16th Finance Commission,” he said.
The Union government still owes about ₹1,140 crores of GST compensation to Karnataka. This compensation should have been paid last year itself. There was about ₹2,233 crore pending, and I raised this issue some months ago and, subsequently, about ₹1,190 crore was released.
The Union government responded that they needed audited accounts from the Accountant General. The audited statements were submitted by the Karnataka Auditor General way back in August 2023. Once we submitted our audit statement, that money should have been released automatically, Byre Gowda said.
The compensation of ₹1,140 crore has been pending for more than one year.
In February this year, former Telangana finance minister T Harish Rao said that the Union government had imposed a cut on the state’s borrowing limit thereby leading the state to a financial struggle.
“… Union government unilaterally imposed a cut of ₹15,033 crore and reduced our borrowing limits to ₹38,937 crore,” he noted.
“This decision of the Centre is totally unjustified and uncalled for. These kinds of cuts are against the spirit of federalism and have eroded the rights of the states,” said Harish Rao
The BJP-led Union government has also broken the tradition of implementing the recommendations of the Finance Commission, Harish Rao contended.
The 15h Finance Commission recommended a special grant of ₹723 crore to Telangana and an amount of ₹171 crore towards nutrition to ensure that the tax devolution should not be less than the amount of devolution received by the state in 2019-20.
“By not accepting these recommendations, the Union government denied Telangana its due share in the Finance Commission grants,” he said.
For the period 2021-26, the 15th Finance Commission recommended grants amounting to ₹5,374 crore to Telangana. By denying these grants, grave injustice has been done to Telangana.
“In the history of the country, no government has ignored the recommendations of the Finance Commission in such a blatant manner,” said Harish Rao.
(With PTI inputs)
