India News: New Delhi: Ahead of the protests planned by Kerala's governing LDF against the curbs put on its borrowing, the Centre justified the limits on the stat.
'Increases in the State’s debt servicing liabilities as a consequence of higher borrowing by it will reduce the availability of funds for development, leading to impoverishment of people and loss of State income, and hence also loss of national income'
Kerala is the second State to move the top court this year in relation to financial disputes with the Central government. It has argued that Centre's actions have the potential to damage the federal structure.
CRISIL on Wednesday pointed out that the social welfare spending of the largest 11 states, which account for 75-80% of the countrys national output, has witnessed a jump since FY18, with the sector accounting for 1.7% share of the GSDP in FY24, compared with 1.2-1.3% earlier.