Centre Sanctions Rs 21,253 Crore to Tackle Kerala’s Crisis

May 27, 2024

The Indian Central Government gave the state of Kerala a lot of money at the end of May 2024 to help it deal with its economic problems. The Minister of State for Electronics and Information Technology told everyone about this change in a public post on platform X. Up until December 2024, the Centre has let Kerala borrow up to Rs 21,253 crores.

Details of the Economic Crisis in Kerala

Kerala has been having a lot of problems with its economy, like not paying its workers on time and stopping progress on many state projects. Employees of the Kerala State Road Transport Corporation (KSRTC) were hit hard by the economic downturn, which messed up their pay streams.

Objectives of the Financial Assistance

The approved borrowings are meant to boost Kerala’s economy by making sure that salaries and pensions are paid on time, that important infrastructure projects like the Coastal Protection and the Mini Harbour Project are completed, and that marine activities are supported. Also, the process of hiring Coastal Police Officers (CPO) will be sped up, which will make the coast safer.

Expected Impacts and Government Accountability

The money that was sent and the permission to borrow more is supposed to help Kerala’s economy get better. People are hopeful that Kerala’s economic stability and growth will get a lot better in the future now that the state government is focusing on dealing with these important problems and getting help from the national government.

More About Economic Crisis in Kerala

Kerala had problems with its economy, especially from 2017 to 2018, when the state’s GDP growth was only 7.18 percent. Because about 36.3% of the state’s income comes from remittances, it is vulnerable to changes in the world economy. More than $4.4 billion was lost in damage from the 2018 floods, which mostly affected crops and tourism. Even though Kerala had a lot of good social measures, its unemployment rate of 9.4% in 2017-18 was much higher than the national average. It hit 31.4% of GSDP in 2020, which shows that the state’s finances are still under a lot of stress due to high welfare spending and slow industrial growth.

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