Karnataka CM Siddaramaiah seeks Rs 11495 crore funding from FM Nirmala Sitharaman

In the wake of the Central Finance Commission's report highlighting skewed fund allocation, Karnataka Chief Minister Siddaramaiah has penned a letter to Union Finance Minister Nirmala Sitharaman, imploring the release a special grant of Rs 11,495 crore. 

The report revealed that the state government's allocation of funds was unjust, deviating from the earlier recommendation of the Finance Commission.

The disparity in funding allocation is not a new concern for the state. The 14th Finance Commission had trimmed Karnataka's share of tax revenue by 3.64%, and the subsequent 15th Finance Commission further reduced it by 4.71% for the period spanning 2021 to 2026. 

Consequently, the state's share from the central pool stands at ₹37,011 crores, a substantial decrease from previous years. To rectify the perceived injustice stemming from the 14th Finance Commission, a sum of ₹5,495 crores was designated in the 2020-21 budget. 

The Finance Commission had also recommended the disbursal of special grants to the state, an idea reiterated in the final report of the 15th Finance Commission for the 2021-26 period. A significant portion of this grant, approximately ₹6,000 crores, was earmarked for the development of Bengaluru’s water bodies and the peripheral ring road. 

Despite these recommendations, Chief Minister Siddaramaiah expressed discontent over the non-release of the stipulated special grant.

The fallout from the Finance Commission's recommendations not being acted upon has cast a shadow on the state's economic stability. The CM's letter underscores the need for immediate action to redress this imbalance and aid the state's economic resurgence. 

As Karnataka awaits the Union Finance Minister's response, the demand for equitable funding allocation remains a pressing concern for the state's leadership.

For now, the state government's focus remains steadfast on achieving a fair allocation of funds in line with the Finance Commission's recommendations.on