'Happy to give crores to Kerala, but one condition'; says Union Min Nitin Gadkari

NEW DELHI: Union Transport Minister Nitin Gadkari said he had no qualms about allowing crores in financial aid to Kerala for the development of national highways. However, the BJP leader demanded that the Kerala government accept a condition. Gadkari’s response came in the Rajya Sabha.

NITIN GADKARI:

“The Chief Minister said that the state government has given Rs 5000 crore for land acquisition for the development of the national highway and there is no way they can pay more. The remedy for this is rejecting GST on construction materials. In Kerala, the cost of completing one kilometre of national highway is Rs 95 crore. The construction cost is 46 crores. However, the cost of land acquisition in Kerala is 46 to 50 crores per kilometre. Gadkari proposes to waive the state's 18 per cent GST on construction materials such as steel and cement, and nine per cent on sand and other royalties.

He said that the transport department is raising money from the capital market, so one lakh crore or two lakh crore would be of no trouble to hand over to the state.

"Two years ago, when I met the representatives of the state government, the Chief Minister had promised to bear 50 per cent of the cost of land acquisition. Rs 5000 crores was invested by the state government but the current problem is that the land acquisition cost for the Ernakulam-Kundannur bypass project has crossed 3600 crores. With this, the Chief Minister regretfully informed that the state was in no way capable of paying such a humungous amount.”

Meanwhile, CPM MP John Brittas said that the state will cooperate if the central government exempts the land acquisition amount from the borrowing limit of the state. Government sources said that avoiding GST would lead to a loss, but if this amount is not included in the borrowing limit, the government will have no big difficulty in paying back the loan.