Ready to let Kerala borrow ₹5,000 crore more, Centre tells Supreme Court

economictimes.indiatimes.com:

Union government on Wednesday told the Supreme Court that it is ready to allow the Kerala government to borrow an additional ₹5,000 crore in the current fiscal year as a one-time measure. However, it will be subject to certain conditions to be imposed in the next financial year.

Additional Solicitor General N Venkataraman also told a bench of Justices Surya Kant and KV Viswanathan that giving additional borrowing to the state in FY 2023-24 is «neither prudent nor in the interest» of the state government.

Rejecting the Centre's offer, senior counsel Kapil Sibal, for the Kerala government, said that the amount was inadequate and the proposal to impose stringent conditions would amount to interference in the state's finances and borrowing powers.

"₹5,000 crore does not take us anywhere. Absolute minimum is ₹10,000 crore. That too they will impose harsh conditions. They say we are not entitled to borrow, but my case is we can," Sibal argued.

Venkataraman contended that the Centre is ready to give a consent for a borrowing of ₹5,000 crore, giving utmost consideration to the SC's suggestion. It is a very special and exceptional measure to help the state to tide over its financial crisis, and meet the end-of-the financial year liabilities of payment of pension, salaries and other committed expenditure, he said.