Kerala Finance Minister K N Balagopal on Monday presented the state budget for the financial year 2024-25 in the assembly, announcing several measures to boost the agriculture sector, which has been hit hard by the pandemic and natural calamities. He allocated ₹1,698.30 crore for the traditional agricultural sector and increased the minimum support price for rubber to ₹180 from ₹170 per kg.
Rubber is one of the main cash crops in Kerala, accounting for about 90% of the country’s production. However, the rubber farmers have been facing a crisis due to low prices and high production costs. The hike in the support price is expected to benefit about 11 lakh rubber growers in the state.
Balagopal also announced a special package of ₹500 crore for the revival of the plantation sector, which includes tea, coffee, cardamom and pepper. He said that a comprehensive scheme would be formulated to address the issues faced by the plantation workers, such as low wages, social security and housing.
The finance minister also set aside ₹50 crore for extreme poverty eradication and ₹134.42 crore for the cooperative sector, which plays a vital role in providing credit and marketing facilities to the farmers. He said that a new scheme called ‘Kisan Credit Card Plus’ would be launched to provide interest-free loans up to ₹1 lakh to small and marginal farmers.
Besides agriculture, Balagopal also focused on tourism, which is another key sector of Kerala’s economy. He said that investments worth ₹5,000 crore would be attracted to the tourism sector in the next three years and allocated ₹351 crore for it in fiscal 2024-25. He said that new tourism projects would be developed in various districts, such as Malabar Cruise Tourism, Wayanad Adventure Tourism and Alappuzha Heritage Tourism.
The finance minister also expressed confidence that Kerala would overcome the economic challenges posed by the pandemic and the Centre’s policies. He said that investments worth ₹3 lakh crore would be brought to the state in the next three years through various projects, such as K-Rail, semi high-speed rail corridor, Kochi Metro expansion and Smart City Mission.
He said that the state’s fiscal deficit was estimated at 3.5% of the gross state domestic product (GSDP) and the revenue deficit at 1.6% of GSDP for 2024-25. He said that the state’s debt burden was expected to rise to ₹3.97 lakh crore by March 2025, but added that it was manageable as long as the state’s growth rate was higher than the interest rate.
Balagopal also announced several welfare measures for various sections of society, such as pensioners, women, children, youth, senior citizens, differently abled persons and transgender persons. He said that social security pensions would be increased by ₹100 per month and free food kits would be continued till April 2025.
He also proposed to increase the tax on liquor by 10% and on petrol and diesel by ₹1 per litre each to mobilise additional resources for the state exchequer. He said that these measures were inevitable in view of the financial constraints faced by the state due to the pandemic and the reduction in central transfers.
The budget was welcomed by Chief Minister Pinarayi Vijayan, who said that it was a pro-people and development-oriented budget that reflected the vision of the Left Democratic Front (LDF) government. He said that the budget would help Kerala achieve a faster and inclusive recovery from the pandemic-induced crisis.
However, the opposition United Democratic Front (UDF) criticised the budget as a ‘bundle of lies’ and staged a walkout from the assembly. They accused the finance minister of presenting a ‘copy-paste’ budget that repeated the promises made in previous budgets without fulfilling them. They also alleged that the budget lacked any concrete measures to generate employment, reduce inflation and revive the economy.