The State is facing a grave financial crisis and the Budget proposals have projects for tiding over the crisis, Finance Minister T.M. Thomas Isaac has said.
Addressing a seminar on “State of Kerala economy’ organised by the Rajiv Gandhi Institute of Development Studies here on Tuesday, Dr. Isaac said the industrial sector had posted growth, but the agriculture sector crisis, dip in NRI income and drastic cut in Central transfers had worsened the crisis.
But the State’s economy had registered a growth, which was much higher than the national average since 1987. The higher growth rate in the past three years had revived the industries sector. This was a very positive indication.
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The floods that battered the State in two successive years and the threat that the NRI deposits may dry up any time were matters of concern. The coronavirus outbreak would have serious national and international ramifications. This called for strong government intervention. The Central approach at this juncture was not favourable to the State, he said.
The Minister refuted charges of the Budget neglecting the capital and said that his reply to the Budget discussion would address the criticism against the proposals.
V.D. Satheesan, who addressed the seminar, said the Budget lacked proposals to address the economic slowdown. The figures rolled out in the Budget lacked credibility. The packages listed in the Budget were election packages. While the State expected an income of ₹1,15,000 crore in the previous year, there was shortfall of ₹16,000 crore. The income from Goods and Services Tax and Central share would not increase. Hence, there was no room for an optimism in raising the income, he said.
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The proposals for imposing additional tax on automobile and real estate sectors that were facing the woes of the slowdown would again worsen the crisis, he said.