THIRUVANANTHAPURAM: The government is also heading for a severe financial crisis after KSRTC. Concerns remain over the next month's salary for government employees.
In addition to the effect of Covid, the state's financial crisis turned severe after the centre failed to sanction a loan of Rs 4,000 crore. The states can borrow up to 3.5 per cent of GDP.
The amount presently required by the state government is Rs 4,000 crore as per the norms. It is not clear why the central government is reluctant to grant permission.
The centre has been presenting in the CIG report for the past two years that KIFBY loans and social security liabilities should be part of the budget. The state government suspect whether this is a continuation of the move not to sanction loans.
There is a directive before the finance ministry to set aside 10 per cent of the employees' salaries for later payment to overcome the crisis. However, Finance Minister K N Balagopal said setting aside the salary is not being discussed at the moment. The government is trying to overcome the crisis by other means.