Latest news with #andBudgetManagement
Hindustan Times
25-06-2025
- Business
- Hindustan Times
Siddaramaiah seeks ‘fair share' of central tax revenue
Chief minister Siddaramaiah on Tuesday met Union finance minister Nirmala Sitharaman in New Delhi and sought a fairer share of central tax revenues for the state under the 16th Finance Commission, arguing that the current formula disproportionately penalises states like Karnataka that contribute significantly to the national economy. Chief minister Siddaramiah meets Union finance minister Nirmala Sitharaman, in New Delhi on Tuesday. (ANI) During the meeting, the chief minister highlighted that Karnataka's share in tax devolution saw a sharp decline under the 15th Finance Commission, falling from 4.713% to 3.647% — a reduction of over 23%. This, he said, translated into an estimated cumulative loss of ₹ 80,000 crore over the award period, including the denial of special grants worth ₹ 11,495 crore. 'We have brought to the finance minister's attention that Karnataka has been unfairly impacted by the existing devolution formula, especially due to the over-reliance on the income-distance criterion, which carried a 45% weightage under the 15th Finance Commission,' Siddaramaiah said after the meeting. He urged the Union government to advocate for a more growth-oriented approach in its submission to the 16th Finance Commission. 'We have requested that the weightage for the income-distance criterion be reduced by 20 percentage points and reallocated to fiscal contribution, which reflects a state's share in the national GDP,' he said. The chief minister also objected to the current design of Revenue Deficit Grants, which he argued are misaligned with fiscal discipline objectives laid out under the Fiscal Responsibility and Budget Management (FRBM) framework. 'Revenue deficit grants, in their current form, contradict the spirit of fiscal discipline. We have suggested that the same amount — which was 1.92% of Gross Union Receipts under the 15th Finance Commission — be distributed among all states using the horizontal devolution formula,' Siddaramaiah said. He also flagged the unique developmental challenges faced by regions such as Bengaluru, Kalyana Karnataka, and Malenadu, stating that a fair devolution policy would help accelerate growth and bridge regional disparities. 'This is not a plea for special treatment. Karnataka's proposals are intended to strengthen national resource mobilisation and uphold the spirit of cooperative and competitive federalism,' he said. Siddaramaiah concluded by urging Sitharaman to incorporate Karnataka's proposals in the Union government's official memorandum to the 16th Finance Commission. 'A pro-growth devolution approach will empower every state to contribute meaningfully to India's development journey,' he said. The 16th Finance Commission, set up in December 2023 under the chairmanship of Arvind Panagariya, is expected to give its recommendations by October 31, 2025, which will be applicable for a five-year period beginning April 1, 2026. The 15th Finance Commission headed by N K Singh had suggested that states be given 41% of the divisible tax pool of the Centre for a five-year period from April 2021 to March 2026. With inputs from PTI
The Hindu
24-06-2025
- Politics
- The Hindu
The troubled waters of Godavari
A fresh row has erupted between Telangana and Andhra Pradesh over the Polavaram-Banakacherla Link Project. The project, which will divert 200 tmc ft of Godavari water to the Krishna and Penna basins, aims to provide drinking and irrigation water to the drought-hit Rayalaseema region of Andhra Pradesh. The Andhra Pradesh government has already submitted the pre-feasibility report on the project to the Central Water Commission (CWC). The CWC has now asked the State to now furnish a detailed project report (DPR). In addition, the Centre has offered to fund 50% of the total cost of the project, which is an estimated ₹80,000 crore, as part of the interlinking of rivers; the remaining will be financed through borrowing beyond the Fiscal Responsibility and Budget Management (FRBM) limits. This has upset Telangana as the Centre had reduced the State's borrowing limits under the FRBM Act citing the State's off-budget borrowings to complete the Kaleshwaram project on time. Both the Congress, which is in power in Telangana, and the Bharat Rashtra Samithi (BRS), which is in the Opposition, believe that the project violates the State's riparian rights regarding Godavari waters as well as the provisions of Andhra Pradesh Reorganisation Act, 2014. But the two parties are also busy blaming each other for 'allowing' Andhra Pradesh to plan the project. The other significant Opposition party in the State — the Bharatiya Janata Party (BJP) — has remained largely silent. This is possibly because the BJP government at the Centre has the support of the Telugu Desam Party, the ruling party of Andhra Pradesh. This, the Telangana government believes, has given the Andhra Pradesh government the advantage of getting things done with quick approvals from the Centre. Chief Minister A. Revanth Reddy and Minister for Irrigation N. Uttam Kumar Reddy squarely blamed the previous BRS government for Andhra Pradesh's decision to take up the Godavari diversion project. They cited the first apex council meeting of September 21, 2016, as evidence. That was when the then Chief Minister, K. Chandrasekhar Rao, had stated that 3,000 tmc ft of Godavari water discharges into the sea on average annually and could instead be utilised if there was an 'understanding' between the two States. The BRS objected to this argument saying Mr. Rao had also 'raised objections over the diversion of water from the Godavari to the Krishna without prior consultation of Telangana' during the same apex council meeting. Former Minister for Irrigation, T. Harish Rao, said that the Congress is deliberately misleading the people. He alleged that Andhra Pradesh was conspiring to divert Godavari waters to claim rights on it in the future by seeking re-allocation of water by the Godavari Water Disputes Tribunal. He termed the Congress government's 'soft approach' to the project as a 'mortgaging of Telangana's water rights' and said that this was 'Mr. Revanth Reddy's 'gurudakshina' to his political mentor N. Chandrababu Naidu'. Mr. Rao said that just as the late Y.S. Rajasekhara Reddy had diverted Krishna waters from Srisailam to the non-basin (Penna) areas by expanding the Pothireddypadu Head Regulator, now Andhra Pradesh Chief Minister Chandrababu Naidu was diverting Godavari waters at the cost of Telangana's riparian rights. Mr. Naidu emphasised that the project is essential. Arguing that the Godavari has ample surplus water, he asked why Telangana should object to the use of water that was anyway flowing into the sea. The BRS in turn demanded to know why the Andhra Pradesh government had objected to the Kaleshwaram project if ample water was indeed available in the Godavari. The President of the Telangana Retired Engineers' Association, M. Shyamprasad Reddy, suggested that the Centre carry out the appraisal of the Polavaram-Banakacherla Link Project only after protecting the rights of the people of Telangana by giving permissions/clearances/approvals to all the ongoing and contemplated projects in the Godavari basin. The former chief engineer also suggested that the Centre additionally allocate more than 200 tmc ft of water in the Krishna basin in lieu of the diversion of Godavari water to other basins. Water-sharing is a sensitive issue and is linked to the economy and regional sentiments. The Centre would do well to be as unbiased as possible when dealing with inter-State water disputes.
The Hindu
24-06-2025
- Business
- The Hindu
Adopt growth-oriented approach in tax devolution, Siddaramaiah tells Nirmala Sitharaman
Urging the Centre to adopt a pro-growth approach in tax devolution among the States by the 16th Finance Commission, Chief Minister Siddaramaiah on Tuesday highlighted the developmental challenges in Karnataka. The Chief Minister, during his meeting with Union Finance Minister Nirmala Sitharaman in Delhi on Tuesday, highlighted the developmental challenges in Bengaluru, Kalyana Karnataka, and Malnad regions, and argued that a fair and pro-growth devolution would accelerate the State's growth. Special grants The State has sought special grants to Bengaluru since it requires ₹1.15 lakh crore to undertake capital work, while grants have been sought for the Malnad region affected by floods. The State has also sought grants for the Kalyana Karnataka region that is covered under the Article 371 J providing special status, but is yet to receive money from the Centre. Claiming that Karnataka has lost a total of ₹80,000 crore during the award period of the 15th Finance Commission, the Chief Minister said that Karnataka's share in tax devolution declined from 4.713% to 3.647%, while the State was also not allocated ₹11,495 crore of the special grants. A major reason for this, he pointed out, was the over-reliance on the income distance criterion, which received 45% weightage under the 15th FC. 'The State government has requested the 16th FC that the weightage for income distance should be reduced by 20 percentage points and reallocated to fiscal contribution, which is the State's share in the national GDP,' he said. The Chief Minister told reporters in Delhi that his meeting with the Finance Minister followed his earlier meeting with the chairperson and members of the 16th Finance Commission. He said that an additional memorandum has been submitted. 'Karnataka's population constitutes 5% of the country's population, but the State contributes 8.7% to the GDP, which is third in the country. In GST collection, we are second in the country.' Revenue deficit grants Karnataka has also requested the Centre to discontinue the Revenue Deficit Grants in their current format since they are against the principles of fiscal discipline as proposed in the Fiscal Responsibility and Budget Management framework. The State has proposed that the same amount — which was 1.92% of the gross union receipts under the 15th FC — should be redistributed among all States using the horizontal devolution formula. The Chief Minister said, 'Deficit grants have been given to Kerala and Tamil Nadu also. Give it to all States or remove it.'
The Hindu
14-06-2025
- Politics
- The Hindu
AP conspiring to illegally divert Godavari water to non-basin areas: Harish Rao
HYDERABAD The Bharat Rashtra Samithi (BRS) has accused the Andhra Pradesh Government of conspiring to 'divert Godavari water on a large-scale, 200 tmc ft a year initially and 400 tmc ft later, to outer basin areas in that State, particularly to the Krishna and Penna basins at the cost of riparian rights of Telangana within the basin'. 'However, our Chief Minister A. Revanth Reddy was keeping mum on the issue, and so were the two Union Miniters G. Kishan Reddy and Bandi Sanjay Kumar,' senior BRS leader and former minister for irrigation T. Harish Rao alleged while making a detailed powerpoint presentation on the Polavaram (Godavari)-Banakacherla (Krishna) Link here on Saturday. 'AP is conspiring for huge water theft without seeking any clearances and approvals, including by the Godavari and Krishna River Management boards (GRMB & KRMB), the Apex Council and statutory agencies such as the Central Water Commission (CWC), GWDT and KWDT and others,' Mr. Harish Rao said. He added that tenders for the project to be taken up with ₹80,000 crore were being called in the month-end and the Centre had also offered 50% of the funding as part of the interlinking of rivers (ILR) and the remaining as borrowing facility beyond the Fiscal Responsibility and Budget Management (FRBM) limits. He reminded that the Centre had deducted Telangana's borrowing for the Kaleshwaram project from PFC (Power Finance Corporation) and REC (Rural Electrification Corporation) from FRBM limits. AP CM Chandrababu Naidu had written to the Centre and CWC against the Kaleshwaram (June 13, 2018) project even after it was given all approvals as an ongoing project in place of Pranahita-Chevella, the BRS leader said. He also wrote against Kalwakurthy LIS, Palamuru-Rangareddy LIS, Bhakta Ramadasu LIS (SRSP tail-end), Tummilla LIS (RDS) and others, all aimed at serving the designed ayacut, to meet shortage of flows in the original plan. He alleged that AP was conspiring to divert Godavari water to claim rights on it in the future by seeking re-allocation of water by the GWDT (Godavari Water Disputes Tribunal). He stated that Telangana had allowed AP to draw 72.2% of the Krishna water (577 tmc ft) against the adhoc arrangement of 512 tmc ft during the last water year. Similarly, for the first time since its formation Telangana had drawn 244 tmc ft (27.8%) against its adhoc share of 34% (299 tmc ft). Mr. Harish Rao demanded that the Telangana Government convene and all-party meet to stop exploitation by AP, convene a special session of the Assembly to discuss the issue, move the Supreme Court and also stop lining of the Srisailam Right Main Canal of the Srisailam Right Bank Canal project to allow carry 90,000 cusecs of water from Pothireddypadu Head Regulator (PRP-HR) from the existing 44,000 cusecs.
