A reasonable and fair methodology needed for providing grants to Puducherry, says N. Rangasamy.
Chief Minister N. Rangasamy has asked the Centre to work out “a reasonable and fair methodology” for provision of grants to Puducherry for implementing developmental and welfare schemes.
In a virtual meeting with NITI Aayog on Friday, the Chief Minister said the Union Territory was not covered under the Central Finance Commission or Union Territory Finance Commission.
The annual growth under Central assistance remained almost static.
In the current financial year, the increase in Central assistance was 1.58% over the previous year. Over a period of five years, the increase in assistance was only 4 to 5%. The increase was very meagre, Mr. Rangasamy said.
“Hence, the Centre is requested to work out some reasonable and fair methodology for provision of grants to take up developmental works and welfare programmes,” the Chief Minister said.
A release from the Chief Minister’s Office said the funding pattern under Centrally sponsored schemes was 60:40. The Central assistance should be increased from 60 to 90%, the Chief Minister said at the meeting.
After the implementation of Good and Services Tax (GST), the Union Territory had suffered a substantial loss of revenue. The compensation given by the Centre would only bridge the gap. In the post-GST compensation period from July 2022, Puducherry would have a monthly revenue loss of around ₹140 crore. So, the Centre should extend the compensation period or release additional assistance, the Chief Minister said.
Mr. Rangasamy also sought financial assistance to take up offshore submerged reef (on the southern end of the beach) project to prevent erosion and protect the coastline. The Central assistance was also required for runway expansion at the airport and tourism projects, he said.
The Centre should also consider starting a ferry service connecting Chennai-Puducherry-Karaikal to encourage tourism activity and trade, he added.
