Tuesday, July 16, 2024
HomeNewsInternational NewsUnion Budget: Kerala seeks Rs 24,000-crore special economic package

Union Budget: Kerala seeks Rs 24,000-crore special economic package

The Kerala government has urged the Center to announce a special economic package of Rs 24,000 crore for the state in the upcoming Union Budget.

Finance Minister KN Balagopal raised the state’s demand at a meeting of state finance ministers convened by Union Finance Minister Nirmala Sitharaman in New Delhi as part of the pre-budget consultations.

Apart from sanctioning the SilverLine semi-high-speed rail project, the state has also sought a Rs 5,000-crore package for the Vizhinjam sea port project in the budget.

Mr. Balagopal said the special package of Rs 24,000 crore was crucial for Kerala to maintain its enviable pace and make further progress in human resource development, sustainable development goals, startup ecosystem and innovation. Mr. Balagopal explained that the state had sought a two-year special plan to overcome the current fiscal crunch.

While taking a final decision on the demands of the state, the Center should consider a sharp cut in tax devolution from 3.875 per cent under the 10th Finance Commission to 1.92 per cent under the 15th Finance Commission, discontinuation of Goods and Services Tax (GST) compensation and reduction Mr. Balagopal said. The state government has also urged the Center to increase the state borrowing limit to 3.5 per cent of the gross state domestic product (GSDP).

‘VISL package’

Noting that Vizhinjam seaport will play a huge role in the development of the country, Kerala has sought a Rs 5,000-crore “VISL scheme”, short for “Vizhinjam International Seaport Limited”. The state is also seeking financial assistance for other major infrastructure projects including the Kozhikode-Wayanad tunnel project.

Silver Line Project

In urging the SilverLine program to be expedited, the state argued that existing rail infrastructure was insufficient to meet passenger demand, underscoring the SilverLine program’s relevance. The state is also seeking more express and passenger trains.


The state government has urged the Center to review its handling of “off-budget” borrowings by the Kerala Infrastructure Investment Fund Board and the Kerala State Social Security Pension Corporation Limited. Its borrowing limits reference these borrowings.

Apart from this, the state also wants the Center to increase its share in centrally funded schemes from 60 per cent to 75 per cent. Countries should have more power in implementing CSS and setting guidelines.

Mr. Balagopal also urged Ms. Sitharaman to announce the establishment of the All India Institute of Medical Sciences (AIIMS), a long-standing demand of the Indian government, and the International Institute of Ayurveda in Kannur in the next budget. Other demands include increasing the support price of rubber to Rs 250 per kg, survey and preparation of DPR for Thalassery-Mysuru and Nilambur-Nanjangud railway lines.



Please enter your comment!
Please enter your name here

Most Popular

Recent Comments