The pre-Budget consultations between the Finance Minister (FM) and state representatives have set the stage for discussions on addressing key fiscal challenges. States have highlighted several priority demands that they hope will be included in the upcoming Union Budget.
States’ Call for Higher Capital Expenditure (Capex)
One of the primary requests from the states is an increase in capital expenditure (Capex). States argue that enhanced Capex will provide much-needed infrastructure and development support, driving economic growth at the local level and creating jobs.
Proposal for Increased Interest-Free Loans
In addition to higher Capex, states have also proposed a hike in the allocation for interest-free loans. This move aims to ease the financial burdens of state governments, allowing them to manage their cash flows more effectively and reduce reliance on expensive credit.
Request for More Exigency Funds
The states are also requesting an increase in the allocation of exigency funds. These funds would provide financial flexibility to states in the event of unforeseen circumstances, such as natural disasters, pandemics, or other emergencies, helping them address urgent needs without delay.
Focus on Fiscal Autonomy and Relief
The states are keen on strengthening their fiscal autonomy and receiving relief in various areas, including GST compensation, to ensure smoother governance and economic stability. They hope the central government will consider these urgent needs in the upcoming Budget.
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