Kerala's Fiscal Future: Requests and Revisions

Kerala has requested increased state tax shares and disaster funds from the 16th Finance Commission. State officials met with Chairman Arvind Panagariya to discuss demands, including revising population-based metrics and increasing central project funding. The Commission will consider these after consulting all states.

Kerala is pressing for a notable increase in its share of central taxes, raising it from the existing 41% to 50%, as conveyed by Arvind Panagariya, Chairman of the 16th Finance Commission. The state also seeks a reduction in the per capita-based share for states from 45% to 30%.

During a press conference following dialogues with Kerala's government and local bodies, Panagariya highlighted Kerala's concerns about facing penalties despite strong growth and effective population control. The commission plans to review these demands with an open mind, after consultations with other states.

Among its demands, Kerala seeks consideration for population density, a factor not previously accounted for by finance commissions. Additionally, the state has appealed for a doubling of State Disaster Response Fund grants and an increment in the central stake in government projects, proportional to its coastline.

(With inputs from agencies.)