Union Budget 2024: It is back to square one for Kerala

The dust has settled on the Union budget that Finance Minister Nirmala Sitharaman presented in parliament and Kerala is back to its good old refrain of severe neglect. This time there is a difference. The complaint has substance. The special favours showered on Andhra Pradesh and Bihar heighten it. 

There was a disproportionate flow of public funds to the states ruled by the BJP’s allies. And the treatment meted out to debt-ridden Kerala lacked mercy. The state’s ruling LDF and the opposition UDF viewed it in the same vein. It was the BJP leaders in Kerala who got trapped. Suresh Gopi, who got a ministerial berth for winning Thrissur Lok Sabha constituency and George Kurien had to struggle for words to explain the situation.

Even those who approached the Centre for a special package of Rs 24,000 crore were not optimistic that they would get it in toto. They just thought it would be a windfall if they got it and nothing to lose if they did not. But it ended up as a futile exercise.

Even the daydream that the Centre would increase the limit on raising debts and thus enable the State to take more loans came a cropper. Some of the BJP leaders from the State were seen giving a push for establishing an AIIMs in Kerala. That dream too did not materialise.

The hope that Gautam Adani's closeness to Prime Minister Narendra Modi would translate to more Central funds to the Vizhinjam port region was also dashed. Amid all this, Minister Muhammad Riaz summed this up as: "In the Union budget, Kerala was not apportioned anything, instead it was dismembered.”

Loss of face by asking for more  

Kerala had asked for an infrastructure development package of Rs 5,000 crore for Vizhinjam. The State also informed the Centre that land has been identified to start the All India Institute of Medical Sciences (AIIMS) at Kinalur, Kozhikode. Kerala is also contributing about Rs 6,000 crore as one-fourth of its share of land acquisition for the National Highways by tightening its belt. The State government hoped that by taking all these into account, Kerala would be shown a bit of consideration for its Rs 24,000 crore demand.

Not just Bihar and Assam, Kerala too had suffered the fury of floods. As flood relief aid flowed to Bihar and Assam, the State also dreamed of flood aid. In fact, Kerala had faced not just one, but two floods. 

The State had spent Rs 3,686 crore on the projects sponsored by the Centre. The Centre has not refunded this amount. There is no allocation for the Wayanad tunnel project. Was it because the BJP candidate came a poor third in the Wayanad Lok Sabha contest where the main fight was between Rahul Gandhi and Annie Raja?

Such doubts are there, not just for the State’s finance minister KN Balagopal who has a gaping hole in his pocket. Those who yearn for speedy trains like Vande Bharath also share the same doubts. The third track for the Shornur-Eranakulam rail project with an estimated cost of Rs 1,516 crore has been allocated Rs 5 lakh!

The Centre’s stand is clear, what is the alternative? 

There was a time when Kerala had eight Union Ministers. After that the Modi government has been in power for 10 consecutive years. All these years, the neglect by the Union government has constantly figured in public debates in every budget season. Besides the development of the National Highway, Kerala has not got enough allocation or projects from the Modi government. That is a core issue that this budget has not considered.

The political interests of the ruling parties determine the outlook of every budget. However, the blatant neglect can harm the nation’s federal structure. That was why the protests erupted inside and outside Parliament after the budget. The state government can take comfort in the fact that many other states are with them on this count.

But the state itself must suffer the neglect on its own- especially when it is burdened with debt. More so because only one-fifth of Kerala's total expenditure now comes from central allocations. At the same time, Bihar gets 71 percent and Uttar Pradesh 47 percent as central share. The national average is 48 percent.

The Modi government will be presenting four more budgets. What will the Kerala government do for its own resource mobilization for its development dreams, learning from the approach of the first budget of the third Modi government? The protests raise this question as well.

                                 (The author is Associate Editor, Dhanam Business Media)