The Center has authorized an emergency loan of Rs 4,200 crore, in a timely move to support Kerala's financial needs, granting the state government crucial funds for its Onam celebrations. The approval from the Center arrived just in time, as Kerala was struggling to arrange the necessary finances for the Onam festivities.

Emergency Loan Approval

This year, the Center had approved a total borrowing limit of Rs 37,512 crore for the state. Of this, Rs 21,253 crore was allocated for use until December, with the reminder that remaining amount available can be withdrawn only from January to March.

By last Tuesday, Kerala had already exhausted its Rs 21,253 crore borrowing limit and sought an advance loan of Rs 5,000 crore from the allocation set for the January-March period. Responding to this request, the Center granted permission for an emergency loan of Rs 4,200 crore. The state plans to utilize this amount by the 10th of this month to fund the Onam celebrations.

Financial Planning for Onam

The Kerala government anticipates spending approximately Rs 20,000 crore on Onam, which includes expenses such as salaries, pensions, bonuses, festival allowances, and welfare pensions. The remaining funds required will be sourced from other revenues, including tax collections. Similar to last year, the financial planning further includes providing benefits such as bonuses and festival allowances. Additionally, the State plans to take Rs 1,000 crore loan from the Co-operative Bank that can be used to settle the welfare pension arrears for one or two months. There are also demands arises for a share in the Dearance Allowance (DA) dues for government employees in the Onam time.

Challenges and Public Support

The government had hoped to raise Rs 500 crore through a salary challenge to support those affected by the recent Wayanad disaster. However, unofficial estimates suggest that less than Rs 200 crore has been raised so far. In contrast, the public and many celebrity figures have generously contributed around Rs 317 crore to aid the cause.

With the emergency loan now approved, Kerala is set to proceed with its Onam preparations, ensuring that the festival will be celebrated with the usual grandeur.