Firms in Karnataka ‘scared’ due to inflation, law & order woes: FM Nirmala Sitharaman | India News
BENGALURU: Industries are “scared” to stay invested in Karnataka and they want to get out because of the worsening law and order situation and a worrying fiscal health of the state, Union finance minister Nirmala Sitharaman said here on Sunday. She said Karnataka has slipped from a revenue-surplus state to a revenue-deficit one. “I don’t want to name the companies going out (of Karnataka).Industries want to get out,” she said, launching a multi-front attack on the Congress govt, adding that Karnataka is experiencing inflation higher than the national average.
She trashed allegations that the state had received zilch in the Union Budget. She highlighted disparity in inflation rates, saying, “Between June 2023 and 2024, inflation, on national average, stood at 5.4%, while Karnataka reported 6.1%. In contrast, within Karnataka, between June 2022 & May 2023 (when BJP was in office), the state had a lower inflation rate of 5.39%, well below than the national average of 6%.”
She attributed higher inflation in state to several factors. “Price of petrol was hiked by Rs 3, diesel by Rs 3.50, milk by Rs 5, and property guidance value has been hiked from 25% to 30%. Stamp duty charges are increased by 200% to 500%. Vehicle registration fee hiked by 3%. Naturally, inflation is much higher than the national average,” she said.
The FM raised concerns about the state’s fiscal health and capital expenditure: “Revenue deficit is very high in Karnataka. Capital expenditure is not happening and is reduced. If you don’t spend money on capital expenditure, employment is not going to come.” On increasing state borrowings, she said, “Open-market borrowings have increased; it’s already crossed Rs 1 lakh crore. Borrowing after borrowing is done to fulfil promises,” referring to poll guarantees of Congress.
She trashed allegations that the state had received zilch in the Union Budget. She highlighted disparity in inflation rates, saying, “Between June 2023 and 2024, inflation, on national average, stood at 5.4%, while Karnataka reported 6.1%. In contrast, within Karnataka, between June 2022 & May 2023 (when BJP was in office), the state had a lower inflation rate of 5.39%, well below than the national average of 6%.”
She attributed higher inflation in state to several factors. “Price of petrol was hiked by Rs 3, diesel by Rs 3.50, milk by Rs 5, and property guidance value has been hiked from 25% to 30%. Stamp duty charges are increased by 200% to 500%. Vehicle registration fee hiked by 3%. Naturally, inflation is much higher than the national average,” she said.
The FM raised concerns about the state’s fiscal health and capital expenditure: “Revenue deficit is very high in Karnataka. Capital expenditure is not happening and is reduced. If you don’t spend money on capital expenditure, employment is not going to come.” On increasing state borrowings, she said, “Open-market borrowings have increased; it’s already crossed Rs 1 lakh crore. Borrowing after borrowing is done to fulfil promises,” referring to poll guarantees of Congress.
