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Friday, Nov 22, 2019

Kerala seeks Centre’s nod to hike market borrowing limit, raise Rs 10,500 crore following floods

Chief minister Pinarayi Vijayan said Kerala desperately needed more money and resources to tide over the crisis and the present borrowing limit was an impediment to this.

india Updated: Aug 21, 2018 23:45 IST
Ramesh Babu
Ramesh Babu
Bengaluru, Hindustan Times
An aerial view shows partially submerged buildings at a flooded area in Kerala.
An aerial view shows partially submerged buildings at a flooded area in Kerala. (REUTERS)

Kerala on Tuesday urged the Centre to raise the limit of money it can borrow to deal with the devastation the worst floods in the state in almost 100 years has caused. Rules bar a state from borrowing money more than 3% of its gross domestic product.

Kerala wants the limit to be raised to 4.5% to raise enough resources to rebuild the state as the focus has shifted to rehabilitation after week-long rescue operations ended.

“The enhancement of borrowing limit will help the state to mobilise an additional resource of Rs10,500 crore,’’ said Kerala chief minister Pinarayi Vijayan.

He said Kerala desperately needed more money and resources to tide over the crisis and present borrowing limit was an impediment to this. “The mission is not to restore the state to pre-flood stature but to create a new Kerala from scratch.” Vijayan said they will submit a comprehensive plan to the Centre to mobilise more funds.


The disaster has claimed over 250 lives, displaced more than a million people and led to estimated losses worth Rs20,000 crore.

Vijayan said the government will also impose a special cess with the state GST as part of the on-going revenue mobilization drive to help raise resources. Last week, the government had increased excise duty on liquor to raise additional funds.

Vijayan said each department has been tasked with chalking out specific plans for relief and rehabilitation.

The United Arab Emirates (UAE) has promised Rs700 crore to the chief minister’s relief fund. Out of 25 lakh Non-Resident Indians from Kerala, nearly a quarter live in the UAE.

In Delhi, the Centre on Tuesday announced Rs600 crore assistance for Kerala. A statement issued after a National Crisis Management Committee (NCMC) meeting, said the situation in Kerala was improving but isolated pockets remained cut-off.

“As the rescue operations wind down, the state administration has started de-requisitioning the teams of the defence forces and the NDRF.”

It added an additional allocation of 89,540 MT of rice was being done on Kerala’s request. Additional quantities of green gram and tur dal were also being dispatched.

“Public sector oil marketing companies have contributed Rs 25 crore to the chief minister’s relief fund in Kerala. The ministry of petroleum and natural gas has opened special points in the flood-affected areas of the state for LPG distribution,’’ the statement said. “Permission has also been granted, in coordination with the state government, for non-certified vehicles to carry LPG cylinders. The ministry has also made available 3.2 lakh LPG cylinders and 2.2 lakh regulators.”

The Centre said the railway has so far supplied 24 lakh litres of drinking water in addition to 2.7 lakh water bottles. “An Action Plan has been prepared for the restoration of power supply in all the affected areas. Ninety-four per cent of telecom towers has been made functional. Power supply to telephone exchanges is being restored on priority,” said the statement.

The Union health ministry was supplying three crore chlorine tablets in addition to one crore supplied earlier. Thirty tonnes of bleaching powder and 1.76 lakh sanitary pads have also been sent. The finance ministry has decided to waive off customs duty and GST on the relief materials.