Union Budget: Despite Centre ‘showering blessings’ over state, Kerala govt morose over unmet demands
When the Union Budget was presented in the Parliament, many emotions came out flowing. While many had termed the Budget as historic, many others were left disappointed. However, out of all states, Kerala was the most surprised by the proposals made during the Union Budget.
During the presentation, Union Finance Minister Nirmala Sitharaman announced that the Centre has set aside Rs 65,000 Crore for roads and highway projects in Kerala. The proposal was quite surprising considering that the funds for roads and highway projects did not feature in the 12 demands the state government put before the Centre.
Out of the 12 demands, the state government made proposals for the development of various sectors and increasing the revenue of Kerala. In the case of the Kochi Metro, the state reportedly did not make any demand for a special package and the only demand regarding the Kochi Metro was specific to infrastructure development. However, the Centre earmarked Rs 1,957 Crore for the Kochi Metro second phase which extends towards Kakkanad. The total phase is said to be 11.5 km with 11 stations.
Coming to funds for the road and highway project, Sitharaman allotted Rs 65,000 Crore for the 1,100 km National Highway works. The NH works also include the 600 km Mumbai-Kanyakumari corridor, which will pass through Kerala. Considering the road conditions in Kerala, the only way this corridor can be developed is by constructing elevated highways and widening all roads leading to Kanyakumari.
In 2019, Union Minister Nitin Gadkari told reporters in Kerala that land acquisition in Kerala is quite expensive, but the Centre has informed the state government that considering the circumstances, it will accept whatever costs the state decides. “There is no need for concern over NH widening projects in Kerala,” Gadkari said.
Interestingly, Kerala is not the only state to get funds for road and highway construction projects. Three other poll-bound States — West Bengal, Assam, and Tamil Nadu — were also allotted funds for the same. However, the opposition slammed the Centre allotting funds to only states that are poll-bound.
The Union Finance Minister also made proposals for the development of the Kochi fishing harbour. “I am proposing substantial investments in the development of modern fishing harbours and fish landing centres. To start with, five major fishing harbours — Kochi, Chennai, Visakhapatnam, Paradip, and Petuaghat — will be developed as hubs of economic activity. We will also develop inland fishing harbours and fish-landing centres along the banks of rivers and waterways,” she said.
Once again, the Kerala government made no special demands regarding the development of the Kochi fishing harbour. However, the fisherfolk community would be pleased with the Centre’s generosity for its development.
The state government was happy after the Centre accepted the 15th Finance Commission’s recommendations regarding the revenue deficit grants. The Commission suggested that Centre should provide additional revenue deficit grants of Rs 2.94 lakh Crore to nearly 17 states in the next five years, of which Kerala is a part. In this regard, the Centre would give Kerala Rs 19,891 crore for FY 2021-22, which is Rs 4,568 crore more than what the latter will get in this fiscal year (Rs 15,323 Crore). However, the grant may reduce in FY 2022-23 to Rs 13,175 as per the Commission’s recommendation. Moreover, it is suggested that in 2023-24, only Rs 4,749 Crore should be granted and nothing after that.
Sitharaman also gave Kerala the green signal to the State’s ambitious silver line rail project. The Union Finance Minister urged Kerala Chief Minister Pinarayi Vijayan to speed up the land acquisition for the Rs 64,000 Crore semi high-speed rail project, connecting Thiruvananthapuram and Kasargod with 11 stations.
Despite the Centre ‘showering its blessings’ on Kerala, the State government is disappointed with the Union Budget. Chief Minister Pinarayi Vijayan slammed the Centre for ignoring the demands of the state in the Union Budget. The CM said that the state made demands regarding Goods and Services Tax (GST) compensation, Sabari railway line, and AIIMS in Kerala to name a few.
“Demands such as semi-high-speed corridor, raising the debt ceiling, AIIMs in Kerala, increasing allocation of funds for Public Sector Undertakings (PSUs), speeding up highway expansion, hike in rubber subsidy, expatriate rehab, and increasing staff members in embassies in Gulf countries were missing from the Union Budget,” Vijayan said.
The Chief Minister added that the Centre gave Kerala the same treatment when issuing disbursement to states for natural disasters. “Kerala was the worst-affected state during the floods. Last month, the central government disbursed aid to states for natural disasters, and Kerala was left out. The Centre has taken the same approach against Kerala in the Union Budget,” he said. State Finance Minister TM Thomas Isaac expressed his unhappiness, terming the Union Budget as huge a disappointment for Kerala.