Thiruvananthapuram, May 18: Kerala Chief Minister, Shri Pinarayi Vijayan has said that the five-phased financial package announcements by the Union Finance Minister had nothing for the public healthcare sector. During this Covid situation, a substantial public healthcare package was required.
“Many international agencies have pointed out that the package will cost an additional Rs.1.5 lakh crore from the central budget this year. Even if we add free ration and direct cash transfer to ordinary people, it would not have been 5% of the total package. The bulk of the Rs 20 lakh crores is the amount available to the banks as part of the RBI’s monetary policy and the amount that these banks are expected to pay to farmers and small businesses. The reality is that banks are wary of giving loans during today’s financial uncertainty. The Finance Minister has opened up most sectors for private investment. The public sector will be limited to some strategic areas. However, strengthening the PSUs is the Kerala Government’s policy”, he added.
The Kerala Government had earlier announced a package for the Micro-Small and Medium-Sized (MSME) sector. This will be implemented in conjunction with central announcements. The state government will take immediate steps to make maximum use of the credit facilities announced by the central government for MSMEs.
Kerala will take full advantage of the Rs 40,000 crore increase in the budget allocation for the Mahatma Gandhi National Employment Guarantee Scheme. Steps have been initiated to utilize the additional refinance fund available to Kerala Bank and Kerala Grameen Bank through NABARD with the Department of Agriculture, Animal Husbandry and Fisheries, Local Self Government and Self Help Groups.
Kerala welcomes hike in borrowing limit but unhappy with conditions
Chief Minister, Shri Pinarayi Vijayan has welcomed the decision to increase the borrowing limit of the States. “Kerala has been in the forefront in demanding a hike in the borrowing limit of the States and we welcome this decision but it is not as demanded. We are not happy with the conditions set for the use of the increased limits.”
The increase from 3 to 3.5% is without any conditions but the 1% hike from 3.5 to 4.5% is subject to conditions like reforms in the public distribution system, the ease of doing business, energy and the local bodies in the city. There will be an increase of 0.25% for each sectoral reform. And finally, the increase from 4.5 to 5.5 % can be achieved only if three out of the four reforms were implemented successfully. Kerala can get a 0.5% increase, without any conditions, on the current borrowing limit of Rs 27,100 crores (Rs 4,500 crores only).
“The States’ domestic revenues have fallen drastically during the Covid situation. So even if the borrowing limit is increased, it will be of limited benefit. Such preconditions are not acceptable in a federal setup”, he added.
Minister of Health & Social Justice, Smt K K Shailaja; Revenue Minister, Shri E Chandrasekharan, and Chief Secretary, Shri Tom Jose IAS were also present during the briefing.