THIRUVANANTHAPURAM: The Kerala government is currently facing a severe financial crisis, leading it to be in overdraft for a week. As a result of the depleted government coffers, the state has resorted to perpetual loans to cover its expenses.
To address the overdraft, the government has planned to borrow Rs 2000 crores on July 18. However, the central government has raised concerns about Kerala’s excessive spending and reminded them of their debt limit.
For the upcoming Onam festival season, the state government requires Rs 8,000 crores for expenses. Additionally, the government also needs to repay a previous debt of Rs 15,000 crores incurred in 2013 during this festival period. This adds further strain to their financial situation.
The Kerala Infrastructure Investment Fund Board’s (KIIFB) loans are considered public debt, imposing constraints on the state’s borrowing capacity. This leaves the government with limited options, and cutting expenses seems to be the logical solution. However, the government appears hesitant to take this approach and continues to increase unnecessary expenditure, raising concerns about nepotism.
In a recent development, the state government decided to cover the personal liability of the late former MLA KV Vijayadas.
But at the same time, they are unable to pay the salaries of KSRTC employees and other government employees due to the lack of funds.
According to provisional reports from the Accountant General, there is a substantial difference of Rs 9334.39 crores between revenue and expenditure during the months of April and May. This indicates that Kerala is currently experiencing its most significant financial crisis in the last five years.
The situation calls for urgent action and prudent financial management to overcome the crisis and ensure the welfare of the state and its citizens.
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