Mamata Banerjee gets Rs 8,750 cr bailout after FDI hit

The bailout package, in the form of the backward regions grant fund (BRGF), comes just three days after Mamata Banerjee, the chief of the second-largest ally in the UPA-2, spiked the FDI in multi-brand retail policy. Saubhadra Chatterji reports. BJP, Left stay firm on FDI rollback

In an effort to address Trinamool Congress chief and West Bengal chief minister Mamata Banerjee’s key concern — the financial health of her state — the cabinet committee on economic affairs (CCEA) will discuss a Rs 8,750-crore bailout package on Wednesday.

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Banerjee, however, wants Rs 19,000 crore.

The sop, in the form of the backward regions grant fund (BRGF), comes three days after Banerjee, the chief of the second-largest ally in the UPA-2, spiked the FDI in retail policy.

It also comes at a time when UPA managers are depending on the Trinamool’s support for passing key bills during Parliament’s winter session and for defeating the Opposition onslaught on other issues.

The Centre recently increased the borrowing limit for the state by another Rs 2,000 crore.

The CCEA note says, “The chief minister of West Bengal wrote to the PM in July 2011 seeking support to tide over the state’s financial difficulties that have become a serious impediment in the development of the Jangalmahal and other backward regions of the state.”

While pushing hard for this package, finance minister Pranab Mukherjee modeled it exactly in the shape of the BRGF given to the Nitish Kumar government in Bihar by UPA-I to stave off Opposition criticism. Kumar got Rs 8,753 crore under the BRGF.

The plan panel will set up an empowered committee, comprising the plan panel, finance ministry and other nodal ministries to finalise the list of projects under this grant.

The package is set to address the identified need of the backward regions of the state through assistance linked to the implementation of projects by the state.