Delhi vows big aid package to bail out Bengal

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The Centre has promised to play trouble-shooter for “financially bankrupt” Bengal. It will provide all sorts of help, both in short term as well as the long term, to help the state government come out of its “financial crisis”. The officers of the state finance department will hold a meeting with the officials of the Union finance ministry about possible measures to resolve the problem before the ministerial level talks to finalise the bailout package.
After around a 50-minute meeting with chief minister Mamata Banerjee at his Dhakuria residence on Sunday afternoon, Union finance minister Pranab Mukherjee said: “Today’s meeting was a constructive one. The Centre will immediately provide all sorts of help to the state that it needs. Though the situation is difficult, the Centre will extend all cooperation to the state government to execute the people’s mandate.”
Terming the situation as a disaster and of a greater magnitude than Cyclone Aila, which had severely damaged the Bengal coastline in 2009, Ms Banerjee said: “The earlier government made the state financially bankrupt. All the state treasuries were closed since November. It is a serious situation. We have been doing a special scrutiny on the overall situation. Our officials will go to New Delhi with relevant papers in the next few days to discuss with senior officials of the Union finance ministry about short-term, mid-term and long-term solutions.”
It was decided in the meeting that state finance secretary C.M. Bachhawat will go to New Delhi to hold meetings with Sumit Bose, currently the Union expenditure secretary, and other senior officers of the finance ministry to work out the bailout package. The package will be later finalised by the chief minister and the Union finance minister when Ms Banerjee goes to New Delhi to attend the Planning Commission meeting.
The issue of land acquisition did not come up at the meeting between Ms Banerjee and the Union finance minister. Besides the two, Sunday’s meeting was attended by state finance minister Amit Mitra, commerce and industries minister Partha Chatterjee, chief secretary Samar Ghosh, Mr Bachhawat and Mr Bose.
Though neither Mr Mukherjee and Ms Banerjee nor anyone else who attended the meeting divulged about the possible bailout package, sources in the state finance department informed that the Centre would give a big amount as loan to help the state.
“It will definitely provide oxygen to the state exchequer, which is fast drying up due to payments of salaries and other non-Plan expenditure of around `2,800 crores every month. The state government has been forced to divert funds earmarked for different Central and state-sponsored projects and schemes to pay salaries. However, in the absence of fiscal discipline and a consolidated fiscal roadmap, any bailout package will not help the state in the long run. We will have to improve our revenue collection manifold,” sources added.