Reopening fiscal wounds

TeaHe expressed anger in Kerala over the “continuous neglect” of the Center in the union budget. For some time, the left-run Kerala and the Bharatiya Janata Party (BJP) government at the Center in the financial sector deepening the mistrust. The Kerala government has repeatedly accused that it is the center of starting the policies of the Center, which has spoiled the imbalance in the sharing of revenue resources and weakening the cooperative federalism.

CPI (M) -Bold Left Democratic Front (LDF) Government and Congress -led United Democratic Front (UDF) criticized the budget for “ignoring” the state. Mainly, BJP’s Kerala unit was quick to describe the budget for Kerala. But its story was immersed in the controversy that was enraged by Union Minister George Kurien that if the state wanted more funds, it might be declared himself backward in terms of infrastructure, education and social welfare so that finance The commission could make useful recommendations.

In addition to demanding a special economic package of 24,000 crore of 24,000 crore to overcome the financial crisis, the Kerala government has to transfer the remaining people of the Venade in July 2024 and for 2,000 crore package, and special For aid’s ₹ 5,000 crore visual port project, which it calls a game-changer for maritime trade. These requests were ignored.

Kerala Finance Minister KNA Balagopal described the Union Budget as “extremely disappointing” and said that it lacked a Pan-India perspective which was sympathetic to the various needs of the states. It is expected, the state budget presented by him on 7 February allocated the first installment of 750 crores for the people affected by the landslides of Mundakkai and Choremla in Wayanad. The assessment documents of post disaster needs prepared by experts estimated the cost of post-glandslide reconstruction and rehabilitation.

The railway budget also disappointed the state. Although Kerala has been allotted Crore 3,042 crore to develop rail infrastructure, but especially any sought by it

The Left Story that Kerala has been re -punished for its hard -earned progress in areas such as education, health and social welfare, was inbuilt in criticism. Chief Minister Pinarayi Vijayan again accused the Modi government of failing to respect the federal principles applicable in the Constitution.

This is the latest episode in a long -standing struggle between Kerala and New Delhi, describing the southern state that it is an inappropriate curb on its decreasing allocation and borrowings from the divisible pool. Kerala moved the Supreme Court last year, challenging the Center’s decision, which reduced his borrowing ability. For recommendations before the 16th Finance Commission’s visit to Kerala in December 2024, the Left Government hosted a closing of a conclusion of finance ministers of non-BJP ruled states to establish common land on common fiscal complaints.

Kerala has repeatedly drew attention to its divisive and pool share which has shrunk from 3.88% under the 10th Finance Commission, which is 1.92% under the 15th Finance Commission. In front of reducing central transfer, Kerala, however, has managed to improve its own tax and non-tax revenue, although it faces difficult financial questions that have no easy answer. NITI Aayog Fiscal Health Index 2025 laid Kerala between “aspiring states”, which have faced “fiscal challenges” continuously in the last nine years. The report said, “These states face high debt, large interest payment, weak revenue generation and disabilities in capital expenditure, affect their fiscal health and ranking with non-tax revenue dependence on non-tax revenue,” in the report It is said that states have been ranked for the 2023 treasury. It called “low quality of expenditure” and “debt stability” as two of the important challenges in the path of Kerala.

It remains to be seen that the 16th Finance Commission, Kerala and its tax deviation will play for concerns by October 31, 2025. It is clear that delicate talks on the financial front with the Center will remain the highest priority of the state, at least in the short term.