Kerala facing liquidity stress due to decline in union fiscal transfers: Governor's address

Thiruvananthapuram: The budget session of the Kerala Assembly began on January 17 with Governor Rajendra Vishwanath Arlekar delivering the policy address. In his address, the Governor highlighted that Kerala is facing liquidity stress due to a decline in the state's share of union fiscal transfers.

Governor Arlekar pointed out that despite the state government's efforts to mobilize revenue and rationalize expenses, the state continues to experience financial stress. The state "has been facing stress on government finances," he said. He attributed the financial challenges to the "tapering of revenue deficit grants and cessation of GST compensation."

The Governor also mentioned that the Kerala government had submitted a detailed memo to the 16th Finance Commission, outlining the financial issues it faces and the steps it is taking to address them. This document highlights the need for additional support to cope with the declining fiscal transfers.

Arlekar also addressed the state's commitment to rehabilitating those affected by the devastating landslides in Meppadi panchayat, Wayanad, in July of last year. The government is focused on completing a township for the displaced people within a year. "The government is committed to taking initiatives to build a disaster-resilient Kerala," the Governor emphasized.

Governor highlights key achievements across sectors

In his address, the Governor also outlined Kerala’s accomplishments in several sectors, including health, education, agriculture, fisheries, and infrastructure. He discussed the ongoing initiatives to further enhance these areas, stressing the government's continued efforts to improve public welfare and economic growth.

The 13th session of the Kerala Assembly will be held for a total of 27 days, from January 17 to March 28, 2025. The discussion on the motion of thanks to the Governor’s address will take place from January 20 to 22. Kerala Finance Minister K N Balagopal is scheduled to present the state budget for the 2025-2026 financial year on February 7.

Agency