Union Finance Minister Nirmala Sitharaman refuted assertions made by the Karnataka government regarding the alleged withholding of special grants by the Centre. She categorically denied any recommendation by the 15th Finance Commission for such grants, effectively debunking Karnataka’s claims of financial injustice.
The dispute escalated when Karnataka filed a writ petition in the Supreme Court seeking the immediate release of funds under the National Disaster Response Fund (NDRF), citing the state’s dire need due to severe drought conditions. However, Sitharaman clarified that no such special grant of Rs 5,495 crore was designated for Karnataka by the Finance Commission.
Sitharaman’s rebuttal came in response to persistent accusations of neglect towards Karnataka’s financial requirements. Earlier demonstrations and petitions by Karnataka’s leadership had criticized the Centre for alleged apathy, particularly regarding fund disbursement.
During an event organized by the Thinkers Forum in Jayanagar, Sitharaman emphasized that every due penny allocated to Karnataka had been disbursed on time. She presented data highlighting a significant increase in tax devolution and grants-in-aid under Prime Minister Narendra Modi’s tenure compared to previous administrations.
According to Sitharaman, tax devolution witnessed a remarkable surge of 258% between 2014 and 2024, representing a substantial increase compared to the previous decade. Similarly, grants-in-aid experienced a staggering rise of 273% during the same period, demonstrating the Centre’s commitment to equitable distribution of funds.
Refuting allegations of delayed payments, Sitharaman underscored that fund allocation to Karnataka had been prompt, often preceding stipulated timelines. She urged the Karnataka government to scrutinize official records and refrain from misleading the public with unfounded claims.
Highlighting post-Covid relief efforts, Sitharaman disclosed Prime Minister Modi’s directive to offer interest-free loans to states for infrastructure development. Despite no formal recommendation by any Finance Commission, the Centre allocated substantial funds to states, including Karnataka, for long-term infrastructure projects.
Sitharaman questioned whether the Karnataka government acknowledged the receipt of Rs 7,130 crore since 2020-21, emphasizing that these funds were beyond the purview of Finance Commission recommendations.
In conclusion, Sitharaman reiterated the Centre’s commitment to transparent and timely fund allocation, urging the Karnataka government to engage constructively based on factual data rather than unsubstantiated allegations. The exchange underscores the complexities of intergovernmental financial relations and the importance of data-driven discourse in addressing grievances effectively.
