Budget 2025: Get more money in 50 years interest free loan scheme, know what states asked for in the budget

In a pre-budget meeting with Union Finance Minister Nirmala Sitharaman on Friday, state finance ministers demanded more funds under the 50-year interest-free loan scheme. Sitharaman said in her statement that due to healthy macroeconomic environment, faster tax collection and efficiency, the amount transferred to the states in the last 45 months under the 15th Finance Commission is more than the amount transferred in 60 months under the 14th Finance Commission. An official statement said, “The Union Finance Minister also mentioned the Special Assistance Scheme to States for Capital Investment (SASCI), which was first announced in the General Budget 2020-21. It has received a very good response from the states.

Punjab and Kerala demanded flexibility in borrowing

Giving this information, sources said that financially stressed states like Punjab and Kerala also demanded special packages and flexibility in borrowing. The states demanded additional funds under Jal Jeevan Mission along with higher borrowing limits to support fiscal activities. According to sources, Maharashtra sought funds for the ‘Mukhyamantri Majhi Ladki Bahin Yojana’ and said that a centrally sponsored scheme (CSS) should be started with the Center and the state sharing 50-50 percent of the cost.

The general budget will be presented on February 1

The Union Budget for the financial year 2025-26 will be presented in Parliament on February 1, 2025. Finance ministers of all states along with Sitharaman attended the meeting held for consultation in this regard. Sources said that many states demanded an increase in the allocation for the 50-year interest-free loan scheme. They also requested more flexibility in the Special Assistance for Capital Investment (SASCI) scheme under this category. Sources said that regarding road and rail infrastructure, the states emphasized the need for road development projects and railway projects. They also demanded an increase in the honorarium being given to accredited social health activists (ASHA).

More funds for disaster relief

Sources said some states asked the central government to bear a major part of the land acquisition cost for the projects. They said the states stressed the need for additional funds for disaster relief and pressed for more allocation for the State Disaster Response Fund (SDRF). Kerala Finance Minister K N Balagopal said fiscal consolidation achieved by restricting government expenditure may not have desirable results.