FM Nirmala Sitharaman rubbishes Karnataka govt’s claim of injustice in release of central grants

Bengaluru: Union Finance Minister Nirmala Sitharaman on Sunday rubbished the Karnataka government’s claim that the Centre was not releasing its due share of ‘special grants’ as recommended by the 15th Finance Commission. She denied that there was any such recommendation by the Finance Commission.

“Karnataka government claims that Rs 5,495 crore special grant was not released to Karnataka and this is totally false. The Finance Commission did not in its final report recommend any such special grant,” the Finance Minister claimed.

Sitharaman’s statement came a day after Karnataka filed a writ petition in the Supreme Court requesting a direction to the Centre to immediately release grants under the National Disaster Response Fund (NDRF) to the state, which is reeling under acute drought.

In February, Karnataka Chief Minister Siddaramaiah, his deputy D K Shivakumar, Congress MLAs and other Congress leaders at the central level staged a demonstration in New Delhi alleging that the Centre was apathetic towards Karnataka’s woes and was not releasing its due share of funds.

“I want to make it a point to tell you in detail that every penny that is due to Karnataka, every paisa that is due to Karnataka, is given, and given on time,” Sitharaman said during a talk organised by Thinkers Forum, Jayanagar in the city.

According to the FM, tax devolution has increased under Prime Minister Narendra Modi between 2014 and 2024 by 258 per cent, which is 3.5 times more compared to the 10 years during the previous UPA rule.

In these 10 years of BJP rule, the grants-in-aid have also increased to 273 per cent, which is 3.7 times more than what it was the previous 10 years, she claimed.

The Finance Minister said that between 2004 and 2014, the money received by Karnataka per year was Rs 81,795 crore, which went up to Rs 2,93,226 crore from 2014 to 2024.

“Nobody's boasting that we've given this much or anything, but to be wrongly alleged, accused that you're not giving money due to Karnataka, I'm sorry, please look at the figures, look at the dates when the money was received and then tell us something which is specific and right, so that I can respond and I will respond,” Sitharaman declared.

“But when we have given it in time and given sometimes even in advance of the time, to just blanket mislead the people to say money is not coming in is not responsible at all,” she charged.

Another set of payments to Karnataka that come under the name of grants-in-aid too increased 3.7 times, Sitharaman said.

“The grant-in-aid between 2004-14 was Rs 60,779.84 crore, which increased to Rs 2,26,832 crore. So I just want the state government to please look into the papers, keep the facts and not mislead the people of Karnataka,” she pointed out.

According to Sitharaman, after Covid, Prime Minister Modi asked the Finance Ministry to give states interest-free loans for 50 years to create infrastructure and spend on the ongoing infrastructure work.

“No Finance Commission had recommended, but the Centre decided to give all the state interest-free loans for 50 years… It might probably even get written off. What was the share of Karnataka in that? Rs 7,130 crore since 2020-21,” the finance minister said.

She sought to know whether the state government acknowledged that Karnataka received the amount, which was not part of the recommendations of the Finance Commission.