Tamil Nadu, which has been reeling from the financial stress caused by the COVID-19 pandemic, is hoping for monetary assistance from the Centre, though several weeks have passed since the Chief Minister made a request for the same.
With COVID-19 cases on the rise, especially in Chennai and three neighbouring districts, the containment and relief measures have placed an additional burden on the State exchequer.
Officials pointed out that the State government had to spend on testing kits and relief measures for the affected sections of the population. The Chief Minister had sought ₹9,000 crore for launching a comprehensive plan for combating COVID-19 and its impact on the State’s economy, and a further grant of ₹3,000 crore for procuring PPEs, N-95 masks and ventilators, and under various other accounts.
Despite the Chief Minister having repeatedly written to Prime Minister Narendra Modi regarding the issue, the Centre’s response has not been positive, a senior official said.
“Besides the austerity measures we have undertaken, we need funds from the Centre to deal with the situation. The Centre should sanction funds to help deal with the pressing needs arising out of the COVID-19 situation,” he explained.
Though certain demands made by the Chief Minister, such as allowing the State to increase its borrowing limit from 3% to 5% of GSDP for the current fiscal, had been accepted, the imposition of “needlessly onerous” conditions had prevented Tamil Nadu from getting the intended benefits, another official said.
Officials in the Tamil Nadu government are wondering whether any of the financial measures announced by the Centre in response to the COVID-19 situation would translate to a loan to the State. “Unless funds are transferred to the States, it (the measures) would not be of much use. The Centre could at least provide loans to us. Without any monetary support, the financial package announced by the Centre will remain an eyewash,” an official argued.
As regards the amounts sanctioned by the Centre to Tamil Nadu under the State Disaster Response Fund (SDRF) and the National Health Mission (NHM), he said, “We would have received the funds under SDRF and NHM even otherwise. The GST compensation that we received recently was something that was due to be paid to Tamil Nadu anyway. We would have received it even if the COVID-19 outbreak had not occurred.”
Another official said that earlier, the sanctioning of funds by the Centre under the SDRF and the NHM was not made public. It was publicised this year only to give the impression that the Centre was providing funds to States to tackle COVID-19, the official added.