Centre ready to give Kerala Rs 5,000 cr

NEW DELHI: The Centre told the Supreme Court on Wednesday it is ready to allow the Kerala government to borrow Rs 5,000 crore, subject to certain conditions, to deal with the financial issues facing the state as a “very special and exceptional measure.”

However, the Kerala government said Rs 5,000 crore “does not take us anywhere” and the absolute minimum requirement stood at Rs 10,000 crore.

The Centre’s statement came a day after a bench of Justices Surya Kant and K V Viswanathan asked it to consider providing a one-time bailout package to Kerala by March 31 to deal with the resource crunch.

The apex court was hearing a suit filed by the Kerala government accusing the Union of India of interfering in the exercise of its “exclusive, autonomous and plenary powers” to regulate the state’s finances by imposing a ceiling on borrowing.

“However, giving utmost consideration to the suggestion of the court, as a very special and exceptional measure, not to be used or cited as a precedent by any other state or on any other occasion, to help the state of Kerala to tide over its financial crisis and meet the ends of the financial year liability of payment of pension, salary and other committed expenditure, if the court so desires, the Government of India is ready to give a consent for a borrowing of Rs 5,000 crore… subject to the following conditions,” Additional Solicitor General (ASG) N Venkataraman, appearing for the Centre, said.

Elaborating, the ASG, who read out a note placed before the bench, said this Rs 5,000 crore will be deducted from the net borrowing ceiling of Kerala for the first nine months of financial year 2024-25 and no ad-hoc borrowing will be granted for the financial year.