Kerala officials, led by Chief Minister Pinarayi Vijayan and Finance Minister K.N. Balagopal, recently met with Union Finance Minister Nirmala Sitharaman in New Delhi to discuss the state’s borrowing limits. During the meeting, Kerala reiterated its request for an additional borrowing limit equivalent to 0.5% of its Gross State Domestic Product (GSDP).
The state presented several specific requests, including the restoration of ₹3323 crore reportedly deducted from its borrowing ceiling in connection with the Guarantee Redemption Fund (GRF). Kerala also sought an additional borrowing allowance of approximately ₹6000 crore over its net borrowing ceiling, citing the state’s contribution of 25% of the land acquisition cost for National Highway development. Furthermore, the state requested the restoration of ₹965.16 crore, which was deducted in April 2025 due to an advance apportionment made by the Centre to address a shortfall in the Integrated Goods and Services Tax (IGST) balance.
According to Mr. Balagopal, the Union Finance Minister responded positively to the state’s submissions.
Source: https://www.thehindu.com/news/national/kerala/kerala-reiterates-request-for-additional-borrowing-space/article70145186.ece