Chennai, Jan 6 (IANS) Tamil Nadu Governor Banwarilal Purohit on Monday said there has been a diminution in the overall flow of central funds to the state.
“Contrary to the impression that the 14th Finance Commission’s recommendations increased the gross flow of resources from the Centre to the States, in reality, there has been a reduction in the gross transfers from the Centre to States,” Purohit said in the Governor’s customary New Year address to the Assembly.
“Moreover, Tamil Nadu has faced a more severe adverse impact due to the horizontal distribution formula of the 14th Finance Commission,” he added.
The Governor said the state is eagerly awaiting the recommendations of the 15th Finance Commission and hopes for a fair and equitable distribution of resources, rewarding efficiency and performance.
Purohit said the state this year has so far received Rs 7,096 crore as goods and services tax (GST) compensation, as well as Central government grants of Rs 17,957.31 crore.
According to him, here are some outstanding issues relating to release of dues to the state by the Central government.
He said in the first year of GST implementation in 2017-18, the Central government, instead of distributing 50 per cent of the unallocated Integrated GST (IGST) in proportion to State GST (SGST) collection in various states, the Centre incorrectly appropriated the entire unallocated portion of IGST to the tune of Rs 88,344.22 crore to the Consolidated Fund of India and distributed 42 per cent of this to the states as per the 14th Finance Commission’s devolution formula.
“This resulted in a net loss of Rs 4,073 crore to Tamil Nadu and we are insisting on the immediate release of this amount due to our State. Due to our efforts, this issue has been referred to a Group of Ministers by the GST Council and we seek an early favourable decision,” Purohit said.
Citing the second India-China Informal Summit between Prime Minister Narendra Modi and Chinese President Xi Jinping last year, he said the state government has sent a proposal for Rs 563.50 crore for tourism development of Mahabalipuram.
Purohit also urged the Central government to upgrade the Gandhigram Rural Institute near Madurai as a Centre of Eminence for Rural Development and Gandhian Philosophy.
On the agricultural front, Purohit said owing to favourable monsoon, the area sown has increased by seven lakh acres and a bountiful food grain production of 115 lakh metric tonnes is expected.