Centre’s economic package to States is empty shell, statistical jugglery

Telangana not to implement power reforms condition imposed by Centre

May 18, 2020 09:46 pm | Updated May 19, 2020 08:15 am IST - HYDERABAD

Chief Minister K. Chandrasekhar Rao along with his cabinet colleagues addressing the media after a cabinet meeting in Hyderabad on Monday.

Chief Minister K. Chandrasekhar Rao along with his cabinet colleagues addressing the media after a cabinet meeting in Hyderabad on Monday.

Expressing his strong displeasure with the economic package announced for the States by the Centre, Chief Minister K.Chandrasekhar Rao termed it as an empty shell and a statistical jugglery.

“This is not what we have asked,” said the Chief Minister in the media conference here on Monday. At a time when the global economy was impacted by the Coronavirus, States requested a package to put money directly into the hands of people.

Even international journals analysed the economic package of ₹20 lakh crore announced by the Indian government and wondered how it could even revive the GDP?

The Centre in its package increased the FRBM limit just by 2 % but with several conditions reflecting a feudal and authoritarian attitude towards the States in violation of the spirit of cooperative federalism.

‘No relief’

The 2% hike in FRBM would enable the State to raise ₹20,000 crore additional loans to be repaid by the State itself. How could it be considered a special package for State. The FRBM hike was given with several conditions. The States would have to fulfil five reforms — power reforms, market committee reforms and municipal reforms to increase taxes, ease of doing business and one nation and one ration card.

They would let States borrow an additional ₹5,000 crore but later they would have to fulfil the reforms and for each one such reform implemented, States would get additional ₹2,500 crore.

“These conditions are laughable and people will understand the deceptive package announced by the Centre. Centres brought down its own dignity by announcing this ‘fake’ package,” he said.

“As State government, I feel pained. This is nothing but an attempt to ride roughshod over the States. A big blow to the concept of Cooperative Federalism. This attitude is not desirable as States are being treated as beggars,” Mr.Chandrasekhar Rao said.

Not subordinates

He said that State governments were not subordinates and they are Constitutionally elected governments with more responsibility towards people in their States and accountable to the people.

He also said that share of States in Central tax devolution was a constitutional condition and right of the State. But Centre was collecting money in the form of cess from people instead of tax and depriving States of their rightful share in Central taxes.

Mr. Chandrasekhar Rao made it clear that the State would not implement power reforms and it would rather let go of that additional ₹2,500 crore. “Telangana is a progressive State and it already achieved three of the five reforms and is a leading State in Ease of Doing Business,” he said.

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