• Says State may not be able to pay pensions and salaries
• Asks Centre to provide special dispensation
• Calls for release of Rs 539 Cr under SPA
Our Correspondent
Kohima | May 2
Nagaland Chief Minister, Neiphiu Rio has written to Prime Minister Narendra Modi asking the Central Government to provide a “special dispensation” to help the State tide over the “impending financial crisis” in Nagaland.
In a letter to the Prime Minister, Rio further urged that pending liabilities of Rs. 529 crore under the erstwhile Special Plan Assistance be released. He informed that NITI Aayog has already given clearance for its release.
The Chief Minister said that the impact of the lockdown on the economy is now clearly visible, adding that Nagaland is now facing a crisis in the management of its finance.
The crisis, according to the Chief Minister, began last year due to the huge shortfall in the state’s share of union taxes and duties, when the amount received was short Rs. 939 crore.
“Being a post-tax devolution revenue deficit state we had no escape but to add to the accumulated deficit. Even during the current financial year, against a projection of Rs. 4,900 crore by the Fifteen Finance Commission, the amount incorporated in the Union budget is Rs. 4,493 crore only,” the Nagaland CM informed.
He further informed that the State's receipts in April of Rs. 264 crore reflects a further decline by about Rs. 57 crore monthly. “This may go down even further in May, which will further compound the already grim situation,” he added.
The Chief Minister expressed concern that the State may struggle to pay even salaries and pensions.
He meanwhile informed the PM that the State has already taken tough austerity measures like freezing fresh appointments, freezing of dearness allowances and relief, prorate cuts in revenue and developmental expenditure including steps to increase revenue mobilization.
“However, given the huge deficit already building up, these measures may not be sufficient to avert a financial crisis,” Rio stated.
