Chief minister DK Shivakumar speaks during the special legislative assembly session to discuss drought
Its preliminary estimate indicates an additional Rs 5,000 crore will be needed just to clear pending irrigation pumpset subsidies.
In a note that was leaked, the FD said: “In view of the severe drought, it is likely that there will be a significant requirement of additional funds over and above the budget allocations for the current year for drought relief and drinking water. The exact requirement will be known only after the Centre responds to a memorandum the state is set to submit soon, the FD said. This will delay or stop other works,” the note said, adding that the govt was already facing a cash crunch, including for salaries for transport, irrigation and electricity supply corporation personnel.
Bengaluru: In a warning to chief minister DK Shivakumar and his cabinet, the finance department (FD) has asked for prudence in expenditure and flagged the likelihood of budgetary cuts across departments. “In the current scenario, even a part of the funds needed for proposals to be met will lead to cutting allocations marked to other departments.
“Let them first get Rs 5,300 crore promised for Upper Bhadra project by finance minister Nirmala Sitharaman and former CM Basavaraj Bommai. He claimed the fiscal deficit was nearing 3%, revenue liability stood at around Rs 22,000 crore, borrowing capacity was exhausted, and bills worth Rs 34,000 crore remained pending.
Responding to the leak, Shivakumar said he was aware of the FD’s concerns but had to weigh the state’s larger interests. We need to continue with the five guarantees amid inflation,” he said. Hitting back at BJP claims that the note proved the govt was going bankrupt, Shivakumar said the Centre should first release Karnataka’s dues. We have to stand with a begging bowl for our share of funds,” he said.
“There is nothing wrong with their advice but as finance minister, I know which programmes to cut and which to continue. In the assembly, BJP member Bharat Shetty demanded a white paper on the state’s financial position. He also flagged salary delays across departments and criticised the govt for holding a cabinet meeting in Mangaluru amid the crunch, linking the strain to the ongoing drought.