'Kerala facing huge financial crisis': State tells HC as Keraleeyam fest kickstarts to showcase state's progress

The ruling left the government in Kerala telling the High Court that the state is reeling under a “huge financial crisis”. In response to the Kerala government's submission in a payment case, the HC criticises the govt for putting the state in a bad light. 

The state government had made such remarks in its affidavit submitted to the HC in a matter related to repaying a depositor of the Kerala Transport Development Finance Corporation (KTDFC) Ltd.

State government's response has come at a time when a week-long celebration Keraleeyam 2023 began in the state on Wednesday. The mammoth festival is being celebrated to showcase Kerala's progress, achievements, and cultural heritage to the world. The event was boycotted by the Congress-led UDF opposition alleging the state government of extravagant spending on the celebration.

"Our state is now passing through a phase of financial constraints. Any monetary benefit has to be allowed within the financial resources available with the government," the government contended, reported news agency PTI.

However, the High Court came down heavily on the state government for its submission and questioned whether Kerala was in a state of financial emergency.

In its affidavit, the Pinarayi Vijayan-led government cited measures for  KTDFC and the Kerala State Road Transport Corporation (KSRTC) to recover their due payments. 

The state said that the KSRTC and KTDFC can mortgage the property or sell one or two items of the property to outside parties or government agencies to solve their financial issues.

"But, unfortunately, no positive steps have been taken by KTDFC or KSRTC," it told the court, adding that the two entities together have immovable properties worth about ₹1,000 crore in the state.

Despite facing a huge financial crisis, the state government released ₹8.440 crore to KSRTC for various expenditures from 2018-19 to October 15, 2023, the state claimed

"Even though the government is supporting Public Sector Undertakings, including KSRTC, in different ways, it is obvious that the government is not legally bound to give financial support to meet its day-to-day affairs," it said in the affidavit.

The affidavit response came into a private company's plea urging the government to intervene and direct KTDFC to pay back the money to the petitioner's company.