New Delhi: Kerala is set to raise concerns with the Centre over what it sees as a double standard in the approval of foreign aid — specifically, how funds denied to Kerala during the 2018 floods were later approved for Maharashtra. State Finance Minister K N Balagopal, who will be in Delhi on Tuesday, has sought a meeting with Union Finance Minister Nirmala Sitharaman to discuss the issue. He is also expected to bring up other matters, including the delay in special relief assistance for Wayanad.

According to the explanation provided, Maharashtra was able to access foreign aid because the Chief Minister’s Relief Fund there had obtained approval under the Foreign Contribution Regulation Act (FCRA) of 2010. However, in 2018, Kerala was denied such approval without citing this technicality.

Under FCRA rules, only entities registered under the Act are permitted to receive foreign donations. Maharashtra is said to have fulfilled the eligibility criteria and secured registration accordingly. Kerala, however, reportedly did not have sufficient time to complete such formalities in the midst of the 2018 disaster. The authority to grant approval lies with the Union Ministry of Home Affairs.

In 2018, the Central Government stated that foreign aid cannot be accepted directly by any Indian state, arguing that such assistance should only occur between sovereign nations. This rationale was used to deny Kerala's request at the time.

Following the denial, the Ministry of External Affairs issued letters to Indian embassies abroad, advising them to politely decline any offers of foreign assistance made specifically for Kerala. The embassies were instructed to express gratitude while refusing the aid.

The policy of refusing foreign disaster aid was first adopted by the UPA Government in 2004 during the tsunami crisis. Then Prime Minister Dr Manmohan Singh had stated that India would handle the disaster on its own and accept help only if absolutely necessary. Since then, India has declined foreign aid for disasters including the Kashmir floods and the 2013 Uttarakhand landslides—the same precedent cited to Kerala in 2018.

Even Kerala’s infrastructure investment arm KIIFB (Kerala Infrastructure Investment Fund Board) has faced similar restrictions. Its first-year attempt to raise funds via a Masala Bond in London was only possible with approval from the Reserve Bank of India, but such approvals were not granted in subsequent years.

Favouritism towards own allies: K K Shailaja

Meanwhile, CPM senior leader and Mattannur MLA K K Shailaja criticised the Central Government, calling its decision to approve foreign aid for Maharashtra after denying the same to Kerala an act of blatant favouritism. She also alleged that the same biased approach is being applied to Wayanad and accused the Centre of discriminating against Kerala.