Mobilising ₹36,506.88 crore from multiple sources for implementing the Rebuild Kerala Development Programme (RKDP) in the short, medium and long-term phases from 2019 to 2027 is the biggest challenge now before the cash-strapped State.
Critical key sectors need an investment of ₹8,709 crore for the short term from 2019 to 2021-22, ₹20,679.69 crore for the medium term (2021 to 2023-24) and ₹7,117.80 crore for the long term from 2024 to 2026-27 to reignite the economy of the State.
Offers so far
Of the ₹8,709 crore needed for executing projects under the short-term plan, the State has so far got commitment for a $500 million Development Policy Loan from the World Bank and another €180 million from the German bank KfW Development Bank.
Around ₹3,000 crore has been mobilised through charity donations for executing projects under the Rebuild Kerala Initiative.
“The agreement with the KfW will be inked later this month and €90 million (₹720 crore) will be used to promote climate-resilient reconstruction of transport infrastructure, including bridges and roads,” says V. Venu, Principal Secretary, Revenue, and Chief Executive Officer, Rebuild Kerala Initiative (RKI).
The State will have to continually keep resolving as it moves along the execution trajectory for the RKDP. Given the level of committed expenditures of the State, one major issue is the lack of fiscal space for the State to borrow.
State’s borrowing
The State’s Gross Domestic Product is estimated to be ₹8.75 lakh crore ($126 billion). Against this, the 3% limit for the State’s borrowing works out to ₹25,000 crore ($37.8 billion).
Conclave
The Development Partners Conclave on July 15 is expected to address the issue of mobilising resources. Country-level heads of funding agencies and others have been invited personally by Chief Minister Pinarayi Vijayan for the conclave where the “A Resilient Recovery Policy Framework and Action Plan for Shaping Kerala’s Resilient, Risk-Informed Development and Recovery from 2018 Flood” will be presented.
The State is seeking an outlay of ₹36,506.88 crore in the critical sectors of roads, water resources management, urban and rural infrastructure, land use planning and management and agriculture, among others .
The fisheries, environment and livelihood sectors have not been included in the initial estimates. It will be assessed subsequently and the outlay needed for executing the RKDP is to go up further.
