Centre says no to bailout debt-stressed Bengal alone

Amid repeated demand from West Bengal Chief Minister Mamata Banerjee to bailout the state from its current financial mess, the Centre on Wednesday said it could not go out of its way to help any one state.

“I come from West Bengal and I have an obligation towards the state. But I have an equal responsibility towards 28 states and cannot do anything that goes against the federal system,” Finance Minister Pranab Mukherjee told the Rajya Sabha in his reply to the discussion on the Finance Bill 2012.

West Bengal has been identified by the 13th Finance Commission along with Kerala and Punjab as the debt-stressed states. The West Bengal government, whose interest payment on an accumulated debt of over Rs 2 lakh crore runs close to Rs 22,000 crore annually, had recently sought a three-year moratorium on interest payment.

The finance minister said that he had appointed a small group of officials to come out with a solution concerning all the three states. He said because of the elections in Punjab, the work could not be completed.

Mamata Banerjee had recently hardened her stance on the demand for a three-year moratorium on interest payment on loans and even indicated that her support to UPA’s presidential candidate would depend on the resolution of the moratorium issue.

Banerjee had met Prime Minister Manmohan Singh earlier this month on the loan issue.

The chief ministers of other two states have also met the prime minister and the finance minister seeking a bail out package for them.

Banerjee had said the state was carrying a legacy of the huge debt burden from the previous Left Front government and that it was the Centre’s responsibility to service that debt.