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Additionally, states have demanded higher allocation for 50 year interest free loans, request for more flexibility in the Special Assistance for Capital Investment scheme under this category. In the Budget for 2024-25, Sitharaman had hiked the allocations for interest-free loans to states for capital expenditure, enabling states to spend more on infrastructure and specified reforms. The allocation was increased to Rs 1.5 lakh crore from Rs 1.10 lakh crore disbursed in 2023-24.
"States urged for an increase in borrowing limits to support fiscal activities and highlighted the need for state-specific road development projects," said sources, according to the ETNow report.
Additionally, sources told news agency PTI that Maharashtra wanted funds for Mukhyamantri Majhi Ladki Bahin Yojana and demanded that a Centrally Sponsored Scheme (CSS) be launched with the Centre and state sharing 50 per cent of the cost each.
The Budget for 2025-26 is slated to be presented in Parliament on February 1, 2025. Finance ministers of all states attended Friday's meeting with Sitharaman.
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Furthermore, some states asked the central government to bear a larger share of land acquisition costs for projects, reported ETNow quoting sources.
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Along with Union Minister for State for Finance Pankaj Chaudhary, the meeting was also attended by Chief Ministers of Goa, Haryana, Jammu and Kashmir, Meghalaya and Odisha; Deputy Chief Ministers of Arunachal Pradesh, Bihar, Madhya Pradesh, Rajasthan and Telangana; the Finance Ministers of States/UTs.
Secretaries of Departments of Economic Affairs and Expenditure, and senior officials of the Ministry of Finance were also present during the meeting.
Ministers from states and UTs have gathered in Jaisalmer for the GST Council meeting scheduled for Saturday.
The finance minister has so far held a series of meetings with various stakeholders, including with MSMEs, farmers' associations, and economists.
The Finance Ministry conducts several pre-Budget consultation meetings annually with experts, industry leaders, economists, and state officials. The formal exercise to prepare the annual Budget for the next financial year has already begun.
As is the convention, the Budget for 2025-26 will be tabled on February 1, 2025.
The 2025-26 Budget will mark Finance Minister Nirmala Sitharaman's eighth. All eyes will be on the key announcements and the government's forward-looking economic guidance for the remainder of the Modi 3.0 tenure.
