February 01, 2023 08:36 pm | Updated February 02, 2023 03:20 am IST – THIRUVANANTHAPURAM
Chief Minister Pinarayi Vijayan.
| Photo Credit: THULASI KAKKAT
The Union Budget 2023 presented by Finance Minister Nirmala Sitharaman on Wednesday appears to have dashed Kerala’s expectations with respect to specific demands made on the infrastructure and fiscal policy fronts.
The State’s long-standing demand for an All India Institute of Medical Sciences-equivalent medical institute and a special package for the economic rehabilitation of ‘return emigrants’ did not find a place in the Budget, according to the State government. The Budget also seems to have ignored the State’s plea for special support for its Ayyankali Urban Employment Guarantee Scheme.
Both the CPI(M)-led LDF government and the Congress-led Opposition UDF criticised the Budget for neglecting the State. Chief Minister Pinarayi Vijayan termed it a pro-corporate document that ignores the growing fiscal and regional imbalances. Finance Minister K.N. Balagopal blamed the Budget for neglecting Kerala, particularly the demands made by the State on fiscal policy. Leader of the Opposition V.D. Satheesan accused Ms. Sitharaman of ignoring workers, small traders, farmers and the self-employed in her Budget and strangling employment guarantee schemes.
That said, Ms. Sitharaman’s announcements with regards to an Agriculture Accelerator Fund — to encourage rural start-ups in the farm sector — and the ‘Digital Public Infrastructure’ for developing farmer-centric solutions appear to hold promise as they coincide with the State’ own plans in this direction. How the State benefits from the ₹2.4 lakh crore allocation for Railways and the ‘Green Growth’ programmes such as the Green Hydrogen Mission and energy transition proposals remain to be seen.
In his reaction to the Union Budget, Mr. Vijayan stated that the government would examine all the Budget proposals and tap schemes that prove useful to the State.
However, Ms. Sitharaman’s plans to change the financing pattern of select schemes from ‘input-based’ to ‘result-based’ and to establish cooperatives in panchayats and villages have triggered concern. These proposals are being viewed as potential invasions upon State terrain.
Demands on GST
Kerala stands disappointed with respect to certain demands on the fiscal policy front made at the pre-Budget consultations. The State had demanded extension of the Goods and Services Tax (GST) compensation period and the creation of a ‘flexible pool’ for Centrally sponsored schemes (CSS) and State-friendly approach to cesses and surcharges collected by the Centre.
Further, it wanted the Centre to revise the shareable portion of GST from 50:50 to 60:40 in favour of the States and to enhance the CSS Centre-State sharing pattern from 60:40 to 75:25. These demands have not been addressed in the Budget.
Space facilities
The Department of Space facilities in Thiruvananthapuram — Vikram Sarabhai Space Centre (VSSC), the Liquid Propulsion Systems Centre (LPSC), and the ISRO Inertial Systems Unit (IISU) — will benefit from the overall departmental allocation of ₹12,543.91 crore. The National Centre for Earth Science Studies (NCESS) has been allocated ₹16 crore.