Kerala Chief Minister Pinarayi Vijayan on Friday strongly criticized the Union Government, accusing it of systematically denying the state its rightful share in tax devolution and misrepresenting its financial performance. Addressing a public gathering on the occasion of his government’s fourth anniversary, Vijayan highlighted a significant mismatch between Kerala’s tax contributions and the funds it receives from the Centre.
According to the Chief Minister, Kerala contributed 3.7% of the total own tax revenue generated by all Indian states in 2022-23 and 2023-24. However, it received only 1.53% and 1.13%, respectively, of the total tax devolution from the Centre during those years. He asserted that based on population share, Kerala is entitled to at least 2.7%, which would have translated to an additional Rs 2,282 crore in 2022-23 and Rs 2,071 crore in 2023-24.
“This is not a demand for more — this is Kerala’s rightful share,” Vijayan said, stressing that his government has taken the matter to the 16th Finance Commission and is working with other states to raise a unified voice against this injustice.
Vijayan also accused the Centre of imposing arbitrary borrowing restrictions, citing a Rs 3,300 crore cut for the current financial year under the guise of guarantee limits. He further alleged that the Union Government is engaged in a false propaganda campaign to paint Kerala’s financial management as poor.
“Contrary to these claims, Kerala has made consistent progress. Our GSDP has grown from Rs 5.6 lakh crore in 2018 to Rs 13.11 lakh crore today, and per capita income has risen significantly since 2016,” he said.
The Chief Minister noted that Kerala continues to push forward with development initiatives despite what he called “deliberate roadblocks” from the Centre. He cited major infrastructure and IT projects as signs of sustained progress, including efforts to reclaim leadership in the tech sector — Kerala was home to India’s first IT park, and the state is again emerging as a hub for tech investment.
He also highlighted a growing disparity in expenditure responsibilities between the Centre and the states.
“State governments now bear nearly 70% of total public spending, while the Centre’s share is shrinking. Yet, our fiscal responsibilities are growing,” Vijayan said.
In defending Kerala’s financial health, Vijayan pointed to Reserve Bank of India (RBI) data, which shows a steady improvement in the debt-to-GSDP ratio — down from 35.3% in 2022-23 to 34.2% in 2023-24. He contrasted this with figures from other states and the Centre: Bihar (39.3%), Punjab (47.6%), West Bengal (38.3%), and the central government itself at 56%.
“These are not just claims; they are backed by data. Kerala is managing its finances responsibly,” he said.
Vijayan also took the opportunity to reflect on his government’s performance since the Left Democratic Front (LDF) came to power in 2016. He claimed that nearly all manifesto promises had been fulfilled and announced the release of a new progress report marking four years of the LDF’s second consecutive term.
“This is a rare achievement — nine continuous years of governance with transparency. Despite a barrage of misinformation, the facts speak for themselves. Kerala is not adrift — we are moving forward,” he concluded.
