Centre hands tied to give extra money to states: FM

Khargram (WB): Amid West Bengal`s sustained demand for a special financial package, Finance Minister Pranab Mukherjee today said the Centre`s hands are tied to provide extra money to states as petro products and food need massive subsidy.

“We (the Centre) have to provide huge subsidy for petro products and food and therefore our hands are tied when it comes to providing extra money to the states,” he said at a meeting of Congress workers here. Mukherjee said the unrest in Syria and Libya had caused the increase in prices of petro products and fertilisers.

“Potash was brought from these two countries but has now stopped due to political unrest there.” He said the UPA government is committed to improving the country`s socio-economic infrastructure and is taking steps in the direction. However, there are delays as Congress has to depend on allies and there are differences of opinion at times.

Referring to bad condition of rural roads, he said Prime Minister`s Gram Sadak Yojana does not provide for money for maintenance and advised MLAS to inform the matter with the state government, which would in turn take up the matter with the Centre. The Mamata Banerjee government in West Bengal, has been demanding special package in the form of interest moratorium. Banerjee, whose party is a crucial constituent of the UPA, herself has raised the issue with the Prime Minister and even issued a veiled threat to the Centre. The state government`s current annual outgo on interest payments is around Rs 22,000 crore.

West Bengal has debt burden of Rs 2 lakh crore and it would have received the relief if the Fiscal Responsibility and Budget Management (FRBM) Act, which aims at bringing financial discipline, were passed in 2005 as recommended by the 12th Finance Commission, he said. Mukherjee had said in Parliament last month that he could not give preferential treatment to the state even though he himself belongs to it. He also said a committee had been set up to look into problems being faced by three debt-stressed states — West Bengal, Punjab and Kerala.