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Kerala Governor Arif Mohammed Khan created a sensation in the Kerala Assembly on Thursday morning when he confined the customary policy address to the 10th session of the State Assembly to just the concluding paragraph of the 136-para text recommended to him by the Council of Ministers headed by Chief Minister Pinarayi Vijayan.
Clearly ruling out any thaw in his frosty relationship with the ruling Left Front and the Chief Minister, the Governor maintained a serious disposition right from his arrival at the Assembly building. He went on to announce that he would read only the last paragraph of the policy address to the consternation of Speaker AN Shamseer and others in the House.
Serious visage
Earlier in the morning, he was received outside the House by Speaker Shamseer, Chief Minister Vijayan and Parliamentary Affairs Minister K Radhakrishnan with bouquets. Neither the Governor nor the Chief Minister bothered to shake hands or exchange pleasantries even as the former was led in a procession into the House and onto the Speaker’s podium for the address.
The Governor read out the last para with the national anthem being played prior to the beginning and at the end of the short address, all of which took less than two minutes. The para said: “Let us remember that our greatest legacy lies not in buildings or monuments, but in the respect and regard we show to the priceless legacy of the Constitution of India and the timeless values of democracy, secularism, federalism and social justice.”
‘Formidable challenges’
The rest of the text was replete with criticism of the Centre’s attitude towards the State government on a number of fronts, especially fiscal. ‘Stupendous achievements’ by the state have come about despite many formidable challenges confronting it. Paramount among these is the liquidity stress from the vertical imbalance between the Union and the States in fiscal matters, the text said.
The fact that the Union possesses a significantly greater capacity to mobilise resources compared to the States, while the latter are mandated to undertake developmental expenditures that far surpass their revenue-generating capabilities, points to a great asymmetry within India’s federal system. Over time this has intensified, constraining the fiscal position of the states.
Compelling case
The consistent decline in the awards of the successive Finance Commissions serves as a compelling case in point. Kerala witnessed a decline in its share of taxes devolved by the Union Government from 3.88 per cent during the 10th Finance Commission period (1995-2000) to a mere 1.92 per cent during the 15th Finance Commission period (2021-2026).
In 2023-24, the discontinuation of GST compensation, a reduction in revenue deficit grant, and restrictions imposed on ‘off-budget’ borrowings of the State exacerbated the fiscal condition of the state. The state has been constrained to approach the Supreme Court for a solution to the financial impasse thrust on the state.
Tax distribution
“My government places the considered opinion before the Union Government that Kerala should be ensured its well deserved share in the distribution of taxes. My government views with concern the holding back of eligible grants and share of assistance in Centrally Sponsored Schemes. Added liquidity stress is being built because of the retrospective cut in borrowing limits, which is not in accordance with the accepted recommendations of the 15th Finance Commission,” the text said.
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