Kerala

Economic emergency in Kerala looms as ministers prioritize personal interests

The governor will likely take decisive action to address the increased risk of violence, crime, and economic mismanagement of Kerala Ministers.

Governor Takes Notice of Urgent Economic Concerns

In a significant development, Governor Arif Muhammad Khan has expressed deep concern over a petition urging him to recommend a declaration of an economic emergency in the state of Kerala. The petition, submitted by RS Sasikumar, the head of the Save University Campaign Committee, sheds light on the precarious financial state of the state government. The urgency is emphasized by the gravity of the situation, as affirmed in the Chief Secretary’s affidavit to the High Court and the 2020-21 CAG audit report.

The Unstable Financial State: A Call for Action

The petition represents a milestone as it marks the first instance of the governor receiving such a plea. It underscores the severity of the financial crisis faced by the state and calls for immediate and decisive action. The Chief Secretary’s affidavit and the CAG audit report are the foundation for the urgent appeal to address the economic emergency.

Financial Liabilities Straining the State’s Resources

The petition details the financial burdens that have placed the state government in a precarious position. It points out that the government has exceeded its loan limit and faces substantial financial liabilities. The petitioner urges the governor to advise the President to declare an economic emergency under Article 360(1) of the Constitution.

The crux lies in the potential for public unrest and increased crime due to the citizens’ deteriorating quality of life. This unfortunate situation is attributed to the perceived neglect of state interests by ministers who seem more preoccupied with their private concerns.

Financial Crunch: Causes and Consequences

The state government’s financial challenges are multifaceted, as highlighted in the petition. The Kerala Civil Supplies Corporation is liable for Rs. 4000 crores, and government contractors are owed a staggering Rs. 16,000 crores for various construction projects. This backlog of payments has strained the state’s financial resources, creating a ripple effect across different sectors.

University college teachers are owed Rs. 1500 crores in UGC salary arrears and DA from 2018. Older people are left in distress due to welfare pension arrears, and introducing a fuel cess for this purpose further underscores the gravity of the financial crisis. The petition draws attention to the pressing need for action, particularly concerning the inability to pay Rs. Twenty-four thousand crores in arrears for the 2019 salary revision, including DA, to government employees.

Challenges in Public Sector Entities: A Wider Impact

Public sector entities grapple with salary payment issues, impacting current employees and retirees awaiting pension benefits. The financial distress extends to the Kerala State Road Transport Corporation, where retirees’ pension benefits are withheld, and even employees’ monthly pensions have not been paid for months.

Investors need help retrieving fixed deposits raised by the Kerala Transport Development Finance Corporation, backed by a government guarantee. Despite a court order to return the money, the state’s financial straits have hindered compliance. The petition notes the gravity of the situation, especially with the Kerala High Court informed that the state cannot provide benefits, including pension, to KSRTC employees.

Governor’s Response and Future Steps

Governor Arif Muhammad Khan has acknowledged the urgency of the matter and plans to seek legal advice on the petition. The Chief Secretary’s report will be meticulously examined to understand the intricacies of the financial challenges faced by the state. However, the complexity of the situation, coupled with ongoing state engagements, may necessitate additional time for a comprehensive report.

The petition, reinforced by the Chief Secretary’s court-recorded affidavit, is a stark reminder of the critical need for immediate attention to the state’s financial woes. The looming economic emergency demands swift and effective measures to alleviate Kerala’s citizens’ burdens. The governor’s involvement in seeking legal counsel and reviewing the Chief Secretary’s report underscores the gravity of the situation and the need for a thorough and timely response.

Rohit Sharma

Rohit Sharma is a seasoned Political Journalist with a deep passion for Indian Politics. With over a decade of experience in the field, he has established himself as a trusted… More »

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