States Demand Increased Financial Flexibility in Pre-Budget Talks

Finance ministers from various states have urged the central government to increase allocations for a 50-year interest-free loan and asked for flexibility in borrowing amid fiscal pressures. States such as Punjab and Kerala are pushing for special financial packages and more relaxed borrowing limits in the pre-budget discussions.

In a significant pre-budget meeting with Union Finance Minister Nirmala Sitharaman, finance ministers from states across the country called for an increase in the allocation of 50-year interest-free loans. This demand was heightened by fiscally strained states like Punjab and Kerala, which are pressing for special financial packages.

The meeting, attended by all state finance ministers, also saw calls for higher borrowing limits to facilitate fiscal activities. Additionally, states have urged for increased funding in initiatives like the Jal Jeevan Mission to improve water supply systems.

The need for a larger share of central funding for state-specific road and rail projects was emphasized, alongside requests for increased honorariums for ASHA workers. States also pressed for additional disaster relief funding and adjustments to the fiscal consolidation targets to prioritize sustainable growth.

(With inputs from agencies.)