Kerala Demands Special Financial Package Amidst Economic Struggles

Kerala seeks Rs 26,000 crore in central aid for liquidity issues and relief efforts in Wayanad. The state also requests continuation of the GST compensation scheme and further assistance for Visinjam Sea Port. Kerala highlights fiscal concerns affecting growth amidst macroeconomic challenges and elevated inflation.

Kerala has urged the central government to consider a substantial financial package to address the state's pressing liquidity crisis. In a recent pre-Budget meeting, state Finance Minister K N Balagopal pressed for a special package totalling Rs 24,000 crore, along with Rs 2,000 crore aimed at relief activities following Wayanad's catastrophic landslides earlier this year.

The meeting, attended by Union Finance Minister Nirmala Sitharaman and finance ministers from various states, underscored Kerala's struggle with fiscal constraints exacerbated by inadequate GST compensation. Balagopal called for the continuance of the GST scheme compensation until systemic discrepancies are resolved, urging a comprehensive approach to fiscal management.

The challenges Kerala faces, he noted, are compounded by rising inflation and economic issues such as slow credit growth and liquidity tightening. Highlighting the state's struggle to maintain growth amid diminishing fiscal powers, Balagopal also appealed for a Rs 5,000 crore package for the Vizhinjam International Sea Port Ltd, thereby emphasizing the need for coherent financial strategies in the upcoming Union Budget.

(With inputs from agencies.)