Last Update: February 02, 2023, 14:12 IST
Thiruvananthapuram, India
Balagopal also said that he himself had sent a letter to Union Finance Minister Nirmala Sitharaman but the Center has not changed its stand so far (Image: ANI)
“Reducing the borrowing capacity of states from the earlier five per cent to three per cent will adversely affect the state’s economy,” Balagopal said during Question Hour.
Kerala Finance Minister KN Balagopal on Thursday said the Center cutting borrowing limits for states will adversely affect the economy of the southern state, which is yet to fully recover from the challenges caused by the COVID-19 pandemic and back-to-back lockdowns. Could not recover. natural disasters.
He pointed out that after including the loans taken by special purpose vehicles like Kerala Infrastructure Investment Fund Board and Kerala Social Security Pension Limited within the overall borrowing limit of the state government, the BJP-led central government has taken steps to reduce the borrowing capacity of the state. adopted a “wrong policy”. State Assembly.
“Reducing the borrowing capacity of states from the earlier five per cent to three per cent will adversely affect the state’s economy,” Balagopal said during Question Hour.
He said that despite repeated requests to restore the previous borrowing limit of the states and avoid including the loans taken by KIIFB and KSSPL in the total borrowing of the state, the central government did not take any favorable step.
Chief Minister Pinarayi Vijayan sent a letter to the Prime Minister Narendra Modi With the request of the state in this regard, he said.
Balagopal also said that he himself has sent a letter to the Union Finance Minister Nirmala Sitharaman But the Center has not changed its stand so far.
Noting that the state budget is prepared on the basis of borrowing limit being fixed by the Finance Commission, the minister said that the loan taken in this way is mainly used for infrastructure development.
He said that cutting the state’s borrowing limit after the budget is passed by the assembly would derail the state’s infrastructure development and delay the completion of ongoing projects.
The Finance Minister said that apart from getting loans, the state government is making every effort to find funds for development projects by increasing tax and non-tax revenue, reducing unwanted expenses and mobilizing maximum resources.
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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)