Thiruvananthapuram, Dec 24 (NationPress) Kerala's Chief Minister Pinarayi Vijayan has claimed that the central government is intentionally limiting the state’s financial independence and hampering its developmental efforts.

During a press briefing on Wednesday, Vijayan highlighted that Kerala's attempts to increase capital expenditure have been consistently obstructed over the last five years. He specifically mentioned the retrospective cut to the state’s borrowing capacity beginning from 2021-22, which categorizes loans from the Kerala Infrastructure Investment Fund Board (KIIFB) as part of the state’s overall debt.

The Chief Minister criticized the Centre's approach, stating that while the Reserve Bank of India had differentiated between guarantees and loans since 1999, the central government’s treatment of Kerala’s borrowing limits contradicts this principle. “Considering KIIFB guarantees as state debt is incorrect and continues a policy that significantly reduces our borrowing ability,” he asserted.

Vijayan expressed frustration that despite multiple requests, including a comprehensive memorandum sent to Union Finance Minister Nirmala Sitharaman on October 9, many of Kerala’s rightful demands remain unaddressed. He remarked, “The Centre discusses development on one hand, yet simultaneously seeks to weaken states like Kerala financially.”

Underlining Kerala’s fiscal progress under the LDF government, the CM noted that net tax revenue surged from Rs 47,000 crore in March 2021 to nearly Rs 80,000 crore currently, demonstrating effective financial oversight. Nevertheless, he contended that the Centre’s measures—such as reduced borrowing ceilings, postponed approvals, and cuts to IGST settlements—have hindered the state’s advancement.

Furthermore, he pointed out the repercussions of international trade limitations, particularly U.S. import restrictions affecting seafood, spices, cashew, and textiles, incurring annual losses of approximately Rs 2,500 crore. “In light of these challenges, the Centre has cut allocations, including Rs 14,358 crore from our borrowing limit for 2025-26 alone, limiting Kerala’s financial capabilities,” he stated.

The Chief Minister condemned the central government’s misuse of Article 293(3) of the Constitution by labeling funds procured by KIIFB and the Social Security Pension Limited as part of the state’s debt, asserting that this action is politically driven and jeopardizes Kerala’s development strategy. Vijayan affirmed that the state would persist in its development agenda regardless of these hurdles.

“Kerala has witnessed significant growth in revenue and resource mobilization, and we will not permit arbitrary central interventions to derail our advancement,” he concluded.