States want FM to give more funds to social, infra sectors

Jaitley promises to redress all concerns

States want FM to give more funds to social, infra sectors

States on Friday demanded an increase in the central allocations towards expenditure on social sector and infrastructure schemes in the Union Budget for 2015-16.

In a pre-budget meeting with Union Finance Minister Arun Jaitley, they also demanded release of more central funds on account of their revenue loss after a single Goods and Services Tax (GST) implementation while some suggested the Centre should not rush through the GST bill in a hurry.

“We strongly urge the Government of India against hustling through the Constitution Amendment Bill hastily, as such a move would bound to have serious long-term implications, on the fiscal autonomy and revenue position of the states,” Tamil Nadu Chief Minister O Panneerselvam said, representing his state, for the meeting.

The GST marks the beginning of a new cooperative partnership between the Centre and the states. However, partnerships will not survive if the dominant player viz the Centre does not take into account the legitimate concerns of the other partners, viz the State and accommodate them in the scheme of things,” Kerala Finance Minister K M Mani said.
States have raised concerns with regard to the issues of compensation under CST losses, negative list and revenue neutral rates under the GST.

Telangana Finance Minister Eatala Rajender asked for borrowing limit to be 3-4 per cent of the state GDP and said the present practice of tide grants has impinged on freedom of states.

Gujarat Finance Minister Saurabhbhai Patel demanded an increase in minimum support price of cotton to help distressed farmers in the states. He also sought imposition of anti-dumping duty on import of vitrified tiles from China and demanded resolution to the issue of royalty on crude oil paid by state explorer ONGC.

“We will take all these suggestions into consideration while formulating policies for the Budget,” Jaitley told reporters, after a four-hour meeting with state finance ministers.

Though Jaitley has claimed that all states are on board for implementation of GST, states like Tamil Nadu and West Bengal still have some reservation and have been suggesting that the Centre should leave some critical issues of rates, compensation and threshold to be decided by the empowered committee of state finance ministers.

States have also raised the issue of more investment on agriculture and infrastructure sectors and the issue of increasing imports from China hurting the domestic manufacturing sector.

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