In a four-hour pre-budget consultation with Union finance minister Arun Jaitley on Monday, representatives of state governments raised the issue while seeking additional allocation for the infrastructure sector, rationalisation of taxes, restructuring of state electricity boards’ .. debt and steps to tame inflation.
The state governments expressed concerns over certain provisions of the new land acquisition law and environment law and their impact on completion of critical infrastructure.
The new government’s key initiatives such as the plan to clean the Ganga and develop waterways also interested the state finance ministers, who raised several queries in this regard at the meeting.
The finance minister emphasised the need for state governments to address supply-side bottlenecks to manage inflation and made a case for putting in place strict measures and special courts to stop hoarding and black marketeering.
The ministers said long inflationary trends had adversely impacted the food and nutritional security of the common man and pointed out that reforming public distribution system was high on the government’s agenda. “We are committed to breaking this vicious cycle of high inflation and high interest rates,” Jaitley said, adding that the slowdown in economic growth coupled with high inflationary pressure posed a challenge to the country’s economy that grew at sub-5% pace over the past two years.
The minister asserted the need for “rounding off corners” towards implementation of the goods and services tax. State FMs, on their part,