‘Karnataka will become revenue deficit state if Centre does not extend GST compensation period’

News Network
February 12, 2021

New Delhi, Feb 12: Karnataka - which is expected to have a debt of over Rs 4 lakh crore at the end of this fiscal year -  will become a revenue deficit state if the Centre does not extend the GST compensation period, Congress MP G C Chandrashekar said on Friday in the Rajya Sabha.      

6Participating in a debate on Budget 2021, Chandrashekar pointed out that the GST compensation provided to Karnataka since 2018-19 was very low despite the state being the third highest tax generator in the country.

At the time of implementation of the Goods and Services Tax (GST) on July 1, 2017, the Centre had promised to compensate states for loss of revenue for five years at an agreed formula.      

Chandrashekar said Karnataka is in a bad financial situation as its debt is rising every year and is expected to cross Rs 4 lakh crore this fiscal year from Rs 3.27 lakh crore in 2019-20.

The state's transportation department is struggling to pay salaries of its staff and could pay half salary in December 2020 and is yet to decide for January, he said, adding that in the current situation it can only afford fuel for buses.  

Even the Bengaluru Metropolitan Transport Corporation (BMTC) is considering borrowing Rs 250 crore, while the transportation department has already mortgaged BMTC head office and is mulling mortgaging more assets, he added.      

"If this situation continues and the GST compensation period is not extended, then Karnataka will move from revenue surplus state to revenue deficit state. Then money will have to be borrowed to pay salaries and administrative costs leaving development activities," Chandrashekar noted.    

Expressing concern over low GST compensation given to Karnataka, the Congress leader said the state had contributed Rs 79,000 crore GST revenue in 2018-19 but in return got only Rs 10,754 crore as compensation. Similarly in 2019-20, the state contributed Rs 84,000 crore GST revenue and received Rs 16,628 crore compensation.    

For 2020-21, the revised estimate shows GST compensation to Karnataka at Rs 7,900 crore, less than Rs 28,000 crore budgeted as GST divulsion, he said.    

Further, he said the government has not given the special grant of Rs 5,495 crore for 2020-21 despite being recommended by the 15th Finance Commission to offset the losses.    

While noting that the Centre has failed to fulfill the promises it made, the Congress leader said suburban rail project to ease Bengaluru traffic was announced in 2018 but work has not yet commenced. The promise of conducting banking exams in regional languages has also not been kept. 

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News Network
January 15,2025

The US consulate in Bengaluru will hold its ‘site-dedication ceremony’ on January 17, with officials confirming that the location of the upcoming consulate will be disclosed during the event. Sources indicate that the site could be in either the Central Business District or Whitefield.

While the consulate building is under development, visa services may temporarily begin at the JW Marriott hotel, which currently houses the United States Commercial Service (USCS) office.

Bengaluru has long advocated for the establishment of a US consulate, and with its opening, residents of the city and Karnataka will no longer need to travel to other states for their US visa applications.

It was in January of the previous year that External Affairs Minister S. Jaishankar, during his visit to Bengaluru, expressed his intention to urge the US Ambassador to India to establish a consulate in the city. This move follows the announcement during Prime Minister Modi’s June 2023 visit to the US, where it was revealed that two new US consulates would open in Bengaluru and Ahmedabad, and India would set up a mission in Seattle.

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News Network
January 9,2025

Mangaluru: In a significant development, Mescom has proposed a phased electricity tariff hike starting with Rs 0.70 per unit for the fiscal year 2025-26. The proposal has been submitted to the Karnataka Electricity Regulatory Commission (KERC) for approval, signaling a potential increase in electricity costs for consumers.

Mescom emphasized that the current tariff structure is insufficient to meet operational expenses and manage revenue effectively. To address this, the company has invited public objections to the proposed hike.

Currently, the electricity supply cost is Rs 9.23 per unit, while the consumer tariff stands at Rs 8.53 per unit, leading to a shortfall of Rs 0.70 per unit. For the financial year 2023-24, Mescom reported revenue of Rs 5,924.73 crore against an expenditure of Rs 6,310.39 crore, resulting in a deficit of Rs 367.66 crore. For the 2025-26 fiscal year, projected revenue is Rs 5,850.81 crore, with an actual requirement of Rs 5,961.63 crore, creating a deficit of Rs 110.82 crore.

In a first, Mescom has submitted a multi-year tariff revision proposal to KERC. The plan outlines a hike of Rs 0.70 per unit for 2025-26, followed by Rs 0.37 per unit for 2026-27 and Rs 0.54 per unit for 2027-28.

"An increase in electricity tariff is inevitable," stated Jayakumar R, Managing Director of Mescom. "Mescom has submitted a proposal in this regard to KERC."

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News Network
January 6,2025

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Karnataka’s first C Band Doppler Weather Radar (DWR) in Mangaluru, work for which was supposed to have been finished by January 15, will be postponed slightly due to some technical difficulties, said N Puviarasan, head of India Meteorological Department (IMD)’s Bengaluru centre.

“We are hoping to get it running by this month's end at least,” said Puviarasan on the sidelines of a stakeholders’ workshop organised by the IMD Bengaluru on January 4 to commemorate 150 years of IMD. The workshop was held at the premises of Karnataka State Natural Disaster Management Centre (KSNDMC) and had day-long sessions, including technical ones by Hindustan Aeronautics Ltd, Bengaluru and Department of Agro Meteorology, University of Agricultural Sciences, Bengaluru.

Puviarasan also said the IMD ran into obstacles in its bid to establish a S-band DWR in Bengaluru, due to problems in acquiring the land required. “We need 30X30 space to put up a tower and a small utility room,” said Puviarasan. According to him, IMD had originally planned to put up the radar in Nandi Hills. But, on Union Minister of State for Micro, Small and Medium Enterprises and Labour & Employment Shobha Karandlaje’s request, he said they started scouting for an appropriate place in Bengaluru. On July 23, 2024 Karandlaje had posted on X: “Following my request, the IMD has greenlit the installation of a Doppler radar in the city (Bengaluru), scheduled to be operational by year-end. This is a major step towards better weather forecasting & preparedness for natural disasters."

She had also posted a letter written to her by Union Minister of State (Independent Charge) Jitendra Singh, who said the radar will have an operational range of 250 km and will be installed in Bengaluru by 2024. He also mentioned that the site for the radar installation has already been identified and the Centre had informed the state government to acquire the site. “But the site suggested by the minister is not feasible because of the elevation issues,” said Puviarsan.

According to IMD scientists, there should not be buildings higher than the radar within its range, as readings will be affected. Puviarasan said they have now identified a place within a government school in Bengaluru and are awaiting permission to establish the radar. He said usually land acquisition is a huge problem. “This time, it’s a government school. Here, we don’t even need to raise a boundary wall, as it exists already. So, we’ll see,” said the director. If this is not working out, he said IMD will go back to its initial plan and will establish the radar in Nandi Hills. Mangaluru radar, being established near Kadri, is expected to cover 250-300 km radius, putting regions prone to heavy rains during monsoons in Karnataka, like Agumbe, Hulikal, Talakaveri, Kerekatte and Bhagamandala within its range, said a IMD scientist. Earlier, in his presentation, Puviarasan had also said apart from Bengaluru and Mangaluru, one X-band DWR is coming up at Dharwad. He also said proposals have been submitted for S-band radar at Honnavara and C-band at Ballari.

Without a DWR, Karnataka has been depending on the radars in Goa, Hyderabad and Chennai for more accuracy in forecasts for thunderstorms and rainfall so far, said IMD officials. In his presentation, Director of KSNDMC, Bhoyar Harshal Narayanrao, talked about why Karnataka is vulnerable to hydro-meteorological and geological disasters. He also said 80 per cent of Karnataka is prone to drought, and that in the last 23 years (between 2001 and 2024), 16 years are drought affected. He also said maximum number of landslides leaving widespread damage and casualties have occurred in Uttara Kannada, Shivamogga, Chikkamamgaluru, Udupi, Dakshina Kannada, Kodagu, Hassan, Chamrajanagara Mysuru and Chikkaballapura. The year 2018 saw the most landslides, at 462, between 2006 and 2024. Narayanrao also said Karnataka is the only state in the south with its own disaster monitoring centre and seeing its success other states are also thinking of establishing one on the lines of KSNDMC. He said KSNDMC is also being approached by a few startups to involve Artificial Intelligence in disaster management. “We are taking a cautious approach towards the idea. We are looking into what AI can offer and will decide accordingly,” said Narayanrao.

Other presentations included an overview of IMD services by S Balachandran, head of Regional Meteorological Centre, Chennai and possible integration of climate services in support of Karnataka State Action Plan on climate change by K J Ramesh, Former Director General, IMD. Sanjeev Verma, AGM, Air Traffic Management, Airports Authority of India, Kempegowda International Airport, Bengaluru also made a presentation of how weather forecasting is integral for air traffic management.

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