Calling Kerala a ‘pauper state’ is baseless: KN Balagopal rebuts Congress leader AK Antony

Former Kerala Finance Minister KN Balagopal has sharply rejected veteran Congress leader AK Antony’s description of Kerala as a “pauper state”, calling the remark “very negative” and unsupported by facts.

Defending the previous LDF government’s handling of the economy, Balagopal argued that despite financial stress, Kerala saw no disruption in treasury payments, salaries, or pensions during his tenure.

The remarks come amid an intensifying political debate over Kerala’s fiscal condition following the change in government, with the new UDF administration expected to release a white paper on state finances. The Federal spoke to KN Balagopal about the “pauper state” remark, the upcoming white paper, and the LDF’s role as Opposition.

Here are excerpts from the interview:

How do you respond to AK Antony’s remark that Kerala’s economy has been “pauperised”? Was that political exaggeration or does it reflect deeper issues?

See, that is a very negative statement about the state. If you make such a serious claim, it must be backed by facts. Over the last five to 10 years, there has been financial stress, yes, but no breakdown in treasury payments, salaries, or pensions. There has been no systemic destabilisation.

If you look at assessments by agencies like the RBI and CAG, Kerala remains among the better fiscally managed states. Our tax collection figures, especially in April, are among the highest in the country. So, to call Kerala a pauper state is not factually grounded.

It is likely political. The UDF made five major guarantees during the election. From his experience, he knows implementing them is financially challenging. So this narrative of “pauperisation” may be a way to justify scaling back those promises later.

Also read: Why Congress govt dumped Kerala's SilverLine project

But, look at what V D Satheesan has done. In the very first cabinet, they announced incentives for ASHA and Anganwadi workers and free bus travel for women. That itself shows the government believes the financial position is manageable.

With the UDF government preparing a white paper on state finances, are you confident your record will stand scrutiny?

A white paper should be an in-depth, objective assessment. If it is prepared professionally and impartially, I am confident it will reflect the real situation.

There are no massive unpaid liabilities except DA and DR arrears, which have already been scheduled for phased payment. Unlike many states, Kerala does not have a long queue of defaulted payments. So let the facts come out.

There was a similar white paper in 2001 under AK Antony. Do you expect another political confrontation over finances?

If this becomes a political document filled with allegations rather than facts, then naturally we will respond with data. But, a government document must be professional and impartial. It is not the responsibility of a party, but of the state.

Also read: From factional tensions to final list: How VD Satheesan shaped Kerala’s new cabinet

Congress-ruled states like Karnataka, Telangana, and Himachal Pradesh are facing real challenges, including delays in salary payments. That experience may be shaping his thinking. But Kerala’s situation is different, and it should not be judged through that lens.

What will be the LDF’s approach as opposition to the new government?

We will be a constructive Opposition. Our approach is very clear. When Pinarayi Vijayan attended the swearing-in, along with leaders like MV Govindan and Vinoy Vishwam, it showed our intent.

Compare that with 2021, when the Congress stayed away from the swearing-in citing COVID. Even during the last budget session, they boycotted proceedings. We are not taking that route.

We will support the government on issues that benefit the state, but if there is anything against public interest, we will strongly oppose it.

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