NEW DELHI: The fight in Supreme Court between the Central government and state government on issues including the reduction of the borrowing limit is starting to intensify. The Centre said that Kerala's filing of the petition was an obstacle to solving the problem and said that the government will permit to borrow 11,700 crores today itself if the petition is withdrawn. Kerala replied that the state government is entitled to borrow this amount even if there is no case.

Kapil Sibal, appearing for Kerala, told the court that there was pressure from the Centre to withdraw the petition. Kerala informed the court that the Centre has put restrictions on the consensus talks between the two sides to resolve the financial crisis. The Centre has taken the stand that issues including loans of Rs 13,600 crore can be considered but rejected the state's demands to resolve the financial crisis. When Kabil Sibal asked why the Centre is having problems with Kerala borrowing from the open market, the Supreme Court responded that borrowing from the open market was a dangerous thing. Kerala argued that the additional borrowing was due to expenditure in the education and health sectors.

Nothing is asked of the central government beyond what is available under law. Kapil Sibal's argument was that the Centre has the power to declare a state of economic emergency. The Centre told the court that all the arguments put forward by Kerala are not correct and the consensus discussion will not proceed well while the case is pending. The Supreme Court has confirmed that the suit petition filed by Kerala seeking urgent permission to borrow Rs 26,000 crore will be heard in detail on March 6 and 7.

The Centre pointed out in the Supreme Court that Kerala can borrow Rs 32,432 crore in the financial year 2023-24. However, the Additional Solicitor General stated that Kerala had borrowed Rs 34,230 crore even before filing the suit petition. 11,731 crores have been allowed to be borrowed in addition to this.

Discussions were held in Delhi on Thursday based on the Supreme Court's direction to resolve the dispute between the Centre and Kerala regarding the borrowing limit. Additional Solicitor General N Venkataraman, on behalf of the central government, handed over a note containing details of this discussion to the court.

The central position that the claimed share will be allowed only if the petition is withdrawn is not correct. Only the deserving claim is being asked.
K. N. Balagopal,
State Finance Minister