‘Fiscal Injustice’ Powers a New Axis of Protest Against Modi Govt

The simmering fault line between BJP-led Centre and non-BJP governments in states came to a boil this week. On Wednesday, chief minister Siddaramaiah and his deputy D.K. Shivakumar led an agitation against the Centre’s alleged ‘financial injustice’ towards Karnataka.

A day later, the Kerala government led by chief minister Pinarayi Vijayan staged a similar protest in the heart of the national capital.

Vijayan was also accompanied by Delhi chief minister Arvind Kejriwal, his Punjab counterpart Bhagwant Mann, and DMK minister P. Thiagarajan. The chief ministers of Andhra Pradesh and Tamil Nadu, YSR Jagan Mohan Reddy and M.K.Stalin, also protested against the unfair devolution of taxes to states that have contributed the most to the state’s exchequer.

This is the first time that all these states have taken to popular protests on these issues, moving the question of partisanship over resources out of discussion rooms. The Bharat Rashtra Samithi-led Telangana government had also agitated over the issue in 2023.

The argument

Both Karnataka and Kerala governments are demanding that their share in the devolution of taxes to states by the Union finance ministry should be greater than what they currently receive, given their share of contribution to the exchequer is also greater than most other states who receive a better share. Moreover, they have said that even the mandated devolution of taxes to Karnataka and Kerala has not been fulfilled by the Union finance ministry, and has created a backlog in the development goals of the states.

There are allied issues, too. The Karnataka government alleged that the Centre has not released special grants worth Rs 5495 crores, as recommended by the 15th Finance Commission, and also denied the promised grant of around Rs 6000 crores for drought-hit Karnataka which it could have used for infrastructure development of water bodies and irrigation projects.