Archive · 24 Dec 2025
Kerala CM Accuses Centre of Financial Blockade
The Chief Minister of Kerala, Pinarayi Vijayan, said the central government is making it hard for Kerala to get money.
He explained that the central government is reducing how much Kerala can borrow and is giving less money to the state.
This is making it difficult for Kerala to pay for important things like schools, hospitals, and roads.
The Chief Minister also said that Kerala is trying to make more money on its own, but the central government's actions are making it tough.
He asked the central government to stop these actions and give Kerala the money it deserves.
Kerala CM Pinarayi Vijayan accused the Union government of imposing a financial blockade on Kerala.
The Centre has reduced Kerala's borrowing capacity by counting state-backed agency loans as state debt.
Kerala's borrowing limit for 2025-26 has been reduced by Rs 14,358 crore due to KIIFB loans and pension-related agencies.
Central transfers to Kerala have declined, with the state's share of divisible central taxes dropping from 3.05% to 1.92%.
Despite improving own tax revenue, Kerala faces financial constraints due to Centre's policies, including GST rate changes and IGST settlement adjustments.
- Who
- Kerala Chief Minister Pinarayi Vijayan
- What
- Accused the Union government of imposing a financial blockade on Kerala
- When
- Wednesday (specific date not mentioned)
- Where
- Thiruvananthapuram, Kerala
- Why
- Due to cuts in borrowing limits and central transfers affecting Kerala's public finances and development plans
- Borrowing Limit Reduction
- Rs 14,358 crore in 2025-26
- Guarantee Redemption Fund Cut
- Rs 3,323 crore
- Central Tax Share Decline
- From 3.05% to 1.92%
- Own Tax Revenue Increase
- From Rs 47,000 crore to Rs 80,000 crore
- GST Rate Change Impact
- Rs 8,000 crore loss estimated
- IGST Settlement Adjustment
- Rs 965.16 crore in April 2025
- Export Sector Loss
- Rs 2,500 crore annually
- Land Acquisition Cost
- Rs 5,580 crore paid