The Hindu : Front Page : Ahluwalia to recommend Kerala's case

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Saturday, Jul 22, 2006

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Ahluwalia to recommend Kerala's case

Special Correspondent

THIRUVANANTHAPURAM: Planning Commission Deputy Chairman Montek Singh Ahluwalia said here on Friday that personally he thought Kerala's demand for being allowed a higher borrowing limit this financial year was genuine.

Answering a question at a press conference, Dr. Ahluwalia said the Planning Commission would recommend the State's case to the Union Finance Ministry.

In February this year, the Union Finance Ministry had fixed the borrowing ceiling for the State at Rs.4,672 crores for 2006-07, keeping it at a much lower level than the State's actual requirement. The ceiling was lowered on the ground that Kerala was a highly debt-stressed State.

Kerala requires to borrow Rs.7,246 crores to finance its annual Plan of Rs.6,210 crores approved by the Planning Commission.

Chief Minister V.S. Achuthanandan, during his visit to New Delhi earlier this month, had taken up this issue with the Planning Commission and also the Union Government.

The Chief Minister had noted that the reduced borrowing ceiling would make it impossible for the State to carry out its annual Plan.

"The Finance Ministry's decision is based on certain norms fixed by the Finance Commission," Dr. Ahluwalia said, adding that the Planning Commission would request the Ministry to review the decision so that Kerala would have funds to finance its annual Plan.

At another press conference on the sidelines of the two-day Regional Consultation on the Planning Commission's Draft Approach Paper for Eleventh Plan, currently on here, State Planning Board Vice-Chairman Prabhat Patnaik said Friday's discussions afforded the South Indian States an opportunity to engage the Planning Commission in a frank and productive discussion on issues concerning economic growth.

"We have differences on the approach. But, we have agreed to note what the differences were among us," he said.

Andhra Pradesh Chief Minister Y.S. Rajasekhara Reddy, Karnataka Chief Minister H.D. Kumaraswamy and Pondicherry Chief Minister N. Rangaswamy also attended the meeting. Tamil Nadu had sent the Vice-Chairman of its Planning Board and its Chief Secretary to the meeting.

On Saturday, the discussions would be at the level of officials, academicians and representatives of non-government organisations.

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