CM Kumaraswamy seeks extension of GST compensation beyond 2022
New Delhi, Jun 15: Karnataka Chief Minister H D Kumaraswamy Saturday asked the Centre to extend GST compensation beyond five years, saying that the state will face "severe financial crunch" after the recompense period ends in 2022.
He was speaking at the first meeting of the Governing Council of Niti Aayog chaired by Prime Minister Narendra Modi here.
While implementing the Goods and Services Tax (GST), the Centre had assured the states to compensate them for loss of their revenue for five years till 2022.
"While the revenue gap is being bridged by the assured compensation till 2022, the state has limited scope to mobilise additional revenue thereafter," Kumaraswamay said.
It is evident that at the end of 2022-23, there would be a steep fall in revenues of the state as compared to the protected revenue of 2021-22 which would have accrued to the state due to the constitutionally guaranteed compensation, he said.
"This would adversely impact developmental and other infrastructural projects implemented in the state as well as committed expenditure of the state government.
"Thus, in case this revenue gap is not bridged in the coming years despite all compliance efforts, adequate compensation, in the manner as envisaged in the Compensation Act, should be extended beyond 2022," he added.
Stating that Karnataka is the most arid state in the country after Rajasthan, the Chief Minister said the state "faces serious drinking water challenges. Ground water table is depleting and ground water sources are getting contaminated."
He urged the prime minister to significantly increase the allocation to rural drinking water sector.
Karnataka is investing Rs 2,800 crore during 2019-20 for rural drinking water, of which the centre's share is only Rs 400 crore, he added.
The chief minister also urged the Centre to approve Rs 2,064 crore relief from the National Disaster Relief Fund (NDRF) for damage to crops in the 2018-19 rabi season.
He also urged the prime minister to release pending Rs 1,500 crore reimbursement under the MGNREGA scheme and raise the fund allocation under the scheme to ensure MGNREGA workers are not subjected to hardship due to delays in payment of wages.
On the ranking system adopted by NITI Aayog, Kumaraswamy said it should be more participative, scientific and transparent.
"For example, giving 58th rank to Bengaluru in Ease of Living Index is unacceptable as Bengaluru is widely rated as the most preferred city for work in the country by reputed agencies," he said.
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EU summit will focus on Iran war, loan to Ukraine blocked by Hungary
Brussels (AP): European Union leaders are holding a summit in Brussels on Thursday for talks on the Iran war, energy prices, migration and an enormous loan for war-ravaged Ukraine being held up by Hungary.
Many of those leaders have deflected entreaties by US President Donald Trump to send military assets to secure the Strait of Hormuz, a key waterway for the global flow of oil, gas and fertiliser.
Rising energy prices because of the war and fears in Europe of a new refugee crisis have pushed leaders to make the Middle East one of the top priorities at the summit.
The European Commission, the EU's executive branch, has floated the idea of a “toolbox” of measures to lower energy prices for leaders to discuss because no single policy will work across the myriad markets in the 27-nation bloc to blunt economic shocks from the war, according to a senior European diplomat who wasn't authorised to be publicly named so spoke on condition of anonymity.
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The summit will also focus on a long-brewing standoff between Hungarian Prime Minister Viktor Orban and most other EU nations.
The last EU summit was held in December at a Belgian castle, where the leaders including Orban agreed to a 90 billion-euro (USD 104 billion) loan for Ukraine for help overcoming a budget shortfall in the country as it grapples with a grinding war with Russia.
But a month later, Orban backtracked after the Druzhba oil pipeline was disabled in January after what Ukrainian officials said was a Russian drone attack.
The pro-Russia leader, who has held office in Hungary since 2010, is running an aggressive media campaign villainising both Brussels and Kyiv as he seeks reelection next month.
“If there is no oil, there is no money,” Orban said in a social media post on Tuesday.
To get Ukraine the much-needed loan, EU leaders and diplomats will lobby Orban and Slovakia's prime minister, Robert Fico, whose government has also taken pro-Russia stances.
On Tuesday, European Commission President Ursula von der Leyen offered for the EU to pay to repair the Druzhba pipeline and the development of alternative fuel lines for Hungary and Slovakia.
Ukrainian President Volodymyr Zelenskyy said that any obstruction to the loan is “absolutely unfair” and that there is “no alternative” for the embattled nation than those funds as it faces a severe budget crisis because of the war, which began on February 24, 2022.
“There may be alternatives in terms of financing mechanisms, but there is simply no alternative to strengthening our army,” Zelenksyy said on Wednesday.
German Chancellor Friedrich Merz told lawmakers in Berlin on Wednesday that the EU must swiftly reach an agreement on the 20th package of sanctions against Russia and the loan.
He said that he would “advocate for that emphatically” in Brussels and that “we must not take into consideration a single country in the European Union that is currently setting up this blockade in Europe now for domestic political reasons and because of an election campaign that is being conducted there.”
Merz said, in urging for more sanctions, that “the needs of the moment call for us to increase the pressure on Moscow together – the US and the European partners together."
