karnataka government has made a strong pitch for additional funds for State-specific schemes at an estimate of Rs 1,42,260.62 crore. The massive drinking water scheme, ‘Jaladhaare’, conceptualised by the Rural Development and Panchayat Raj Ministry, alone has been pegged at Rs 53,000 crore. The state made the demand during its two-day interaction with the 15th Finance Commission led by N K Singh.
Taking strong objection to the Union government cutting down funds for centrally sponsored schemes, Chief Minister H D Kumaraswamy reiterated the burden it has laid on the state government and its economy. The state asserted that despite many welfare schemes, it had adhered to fiscal discipline. “The commission must ensure that once the sharing formula is decided, the Central government should not reduce the funding under the centrally sponsored schemes both in terms of size as well as in the sharing pattern between Centre and State.
During the last five years we have seen that while on the one hand, the Fourteenth Finance Commission has increased the devolution to States from 32% to 42%, on the other hand, the central government reduced its share in centrally sponsored schemes. As a result, most of the additional money received under the devolution formula had to be allocated towards state’s share of the Central schemes,” Kumaraswamy said.
At a press conference, Singh was all praise for the state government, its ministers and officials for their assertive pitches, interactive involvement and data provided to the commission. While the state’s entrepreneurial quality, ability to ensure macroeconomic stability as well as disciplined fiscal responsibility was appreciated, great concern was shown towards poverty rates and agricultural reforms in Karnataka. “It is ironic that Karnataka whose per capita income is higher than the national average also has high poverty levels. There seems to be two Karnatakas — one, a bright example of entrepreneurship that is a growth engine of the nation contributing 8% of national GDP, and another Karnataka that is far less prosperous. The intra-state disparity needs attention,” said Singh. The commission said it has urged the Union Finance Minister to facilitate a dialogue with the GST Council to address concerns raised by States like Karnataka.