States don't run on praise alone, need financial aid too: Thomas Isaac
Hours after Prime Minister Narendra Modi said people abiding by rules and celebrating festivals from their homes was praiseworthy, Kerala Finance Minister Thomas Isaac on Tuesday (April 14) said states didn’t require praise alone, but financial assistance too.
He told reporters, the when states approach banks for loans, the interest rate was 9 per cent. Most states have limited the borrowing to ₹500-1000 crore and started cutting off salaries or halting other developmental activities, he said.
Only two days ago, Isaac had urged the Centre to raise the fiscal deficit limit for states. Government of India should allow states to borrow from the Reserve Bank. Otherwise, the situation would put all state governments in a debt trap, he said.
There is no option other than extending the lockdown. But Centre must learn lessons from the past 3 weeks. 1. Without extensive testing lockdown won’t be effective. 2.Without income support compliance will be low.3.Without additional resources states will be constrained .
— Thomas Isaac (@drthomasisaac) April 14, 2020
After the Centre issues guidelines on Wednesday (April 15), the Kerala cabinet will make a decision on restrictions during the second phase of lockdown, Isaac said, adding that the Centre must learn lessons from the past three weeks.
The Finance Minister also urged the Central government to transfer at least half of last year’s wages to the accounts of every worker registered under the Mahatma Gandhi National Rural Employee Guarantee Scheme (MGNREGS). He added that the Centre must also increase the number of working days to 150.
Issac also sought relaxation in the restrictions imposed in certain regions of Kerala that have not witnessed any new case last week or have successfully brought down the number of active cases. As many as 198 persons out of the total 379 confirmed cases in the state have been discharged.