No assistance for Wayanad and Vizhinjam; heavy setback for Kerala

THIRUVANANTHAPURAM: The Union Budget has dealt a severe blow to Wayanad, which was devastated by landslides, and has also ignored the Vizhinjam Port. This has come as a heavy setback for Kerala which is already struggling with financial difficulties.

Kerala had approached the Centre with several demands, including a Rs 24,000 crore package, Rs 2,000 crore for the reconstruction of Wayanad, which was declared a national disaster, and Rs 5,000 crore for infrastructure development in Vizhinjam. However, all expectations were shattered by the budget announcement.

The state had also sought an AIIMS hospital, a Rs 1,000 crore package to mitigate human-wildlife conflict, and Rs 4,500 crore to strengthen resilience against climate change. However, all these requests were ignored by the Centre. Additionally, major projects such as the SilverLine semi high-speed rail system and the International Research Institute in Ayurveda at Kannur, proposed by Kerala, found no mention in the budget.

On the positive side, the announcement to enhance the capacity of IITs established after 2014 is expected to benefit IIT Palakkad. The extension of the Jal Jeevan Mission (JJM) until 2028, along with increased budgetary allocations, will also be beneficial for Kerala. However, the state currently ranks last in the country in achieving JJM targets.

‘Capex’ might support Vizhinjam
The Centre has accepted Kerala's request to extend the additional borrowing limit of 0.5% of the state’s Gross Domestic Product (GSDP) for power sector reforms until 2025-26, allowing the state to raise an additional Rs 6,500 crore in loans. Additionally, the development of 50 tourist destinations across the country and projects aimed at utilizing "underutilized potential" in the marine fisheries sector could benefit Kerala. The budget has also retained the previous year's allocation for MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act), which is widely utilized in the state.

Moreover, under ‘Capex’, the Centre has allocated Rs 1.5 lakh crore as interest-free development loans with a 50-year repayment period. This may prove beneficial for Vizhinjam. Kerala has not received this loan in the past three years, but this year, it is expected to secure between Rs 5,000 crore and Rs 10,000 crore. Additionally, central schemes in the health and education sectors could also be advantageous for Kerala.