Tamil Nadu’s debt could drop by ₹3 lakh crore if Centre releases pending dues: Finance Minister

Tamil Nadu Finance Minister Thangam Thennarasu on Thursday said in the Assembly that the State’s debt could be reduced by about ₹3 lakh crore if the Union government releases pending dues to the State.

While responding to AIADMK MLA P. Thangamani, who spoke about the reduction in GST rates during the discussion on demands for first supplementary grants, Mr. Thennarasu said due to GST rate rationalisation, the tax revenues of States have declined, thereby increasing their financial burden. He also said that the Union government had not released the GST Compensation Cess owed to the State.

He said the AIADMK, which is in alliance with the BJP, should urge the Centre to release Tamil Nadu’s pending dues. Leader of the Opposition Edappadi K. Palaniswami intervened and said that the DMK and its allies, who have 39 MPs in the Lok Sabha, should raise this issue in the Parliament.

Meanwhile, Chief Minister M.K. Stalin said that MPs from Tamil Nadu have been continuously raising the issue in the Lok Sabha and the State government has been consistently pressing it in GST Council meetings. He accused the BJP government at the Centre of acting with bias and said he had repeatedly raised the issue of pending dues to Tamil Nadu during his meetings with the Prime Minister. He also urged the AIADMK to exert pressure on the Centre.

Mr. Palaniswami said when he met Union Home Minister Amit Shah, he had requested the release of funds for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) to the State, following which the funds were released. Minister for Rural Development I. Periyasamy intervened and said that over ₹1,000 crore was still pending to be released to the State by the Centre.

Mr. Thennarasu said that the DMK government has been paying ₹1.40 lakh crore as interest on the debt inherited from the previous AIADMK regime. During the AIADMK regime, Tamil Nadu’s debt rose to ₹2.11 lakh crore in 2015-16, an increase of 108% from 2011-12. Subsequently, by the end of the next AIADMK tenure between 2016-17 and 2020-21, the State’s debt increased further to ₹4.80 lakh crore, marking a 128% rise. Currently, the State’s debt stands at ₹9.21 lakh crore, a comparatively lower increase of 93% during the DMK’s tenure, the Minister added.