Centre causes injustice to states citing Covid-19: HDK

H D Kumaraswamy hits out at Centre for blaming Covid-19 for contraction of country's economy

H D Kumaraswamy. Credit: DH File Photo

Former Karnataka Chief Minister H D Kumaraswamy on Saturday hit out at the Centre for calling the Covid-19 pandemic an 'Act of God' resulting in contraction of the country's economy.

He was referring to Union Finance Minister Nirmala Sitharaman's comment during the 41st GST Council meeting where she had said the country faced an extraordinary situation and termed the coronavirus pandemic as "an act of God".

In a series of tweets, the JD(S) leader alleged that the Centre has ruined the economy of the states.

"The irresponsible attitude of the Centre in shirking its commitment towards GST shortfall of the states is condemnable. It has dealt a blow to the federal structure of the country by describing the crisis arising out of Covid-19 pandemic as an unforeseen "Act of God," he said.

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He accused the Centre of ruining the economy of states by asking them to resort to borrowings to make up for GST shortfall and also repay them.

"The Centre has placed two options before states. They can opt for borrowing either the GST shortfall amount of Rs 97,000 crore or borrow the entire revenue gap of Rs 2.35 lakh crore that has arisen due to GST shortfall as well as Covid-19 situation," said the former Chief Minister.

Kumaraswamy said the states were 'bewildered' over the development and added "What can they do if the Centre causes injustice to them citing Covid-19? The states that are in a bad economic condition due to Covid-19 and floods are cursing the Centre."

He said the states were in dire straits due to the failure of the Centre whose management of the country's economy is flawed and marked by lack of vision.

He advised that the Centre itself should borrow from the RBI and compensate the states for the losses, instead of asking the states to borrow from the central bank.

"Long ago, the architect of the Indian constitution, Dr B R Ambedkar, had expressed concern that the danger of bringing about legislation that establish control over the state's economy through luring cannot be ruled out in the future. Now, the country is staring at such a danger," Kumaraswamy said.