Nagaland CM seeks Rs 40386.5 crore grant from 16th FC

Appeals Commission for financial aid to bridge developmental deficit

Morung Express News
Kohima | November 6

Nagaland Chief Minister Neiphiu Rio today urged the 16th Finance Commission (XVI-FC) to provide increased financial support to tackle the State’s persistent infrastructure and governance challenges, while proposing a grant of Rs 40,386.5 crore.

During the meeting with the visiting XVI-FC team led by Chairman,  Dr Arving Panagariya, at Hotel Vivor, Kohima on November 5 at Hotel Vivor, Kohima, he highlighted several issues impacting the State’s economic stability, urging the Union Government to consider grants to cover the pressing revenue and capital deficits.

He acknowledged that various commissions’ concern about the ‘economic and financial’ condition of the State, particularly government employees salaries and weak economy condition of the state.

Rio, however, maintained that “The high number of government employees is a legacy of the past when insurgency was at its peak,” resulting in a situation where no one was willing to come forward to invest.

He also cited the establishment of seven Indian Reserve Battalions, funded by the Union Government with recurring expenses borne by the State, and the appointment of numerous teachers and workers under CSS programmes like erstwhile Sarva Shiksha Abhiyan, DRDA, and Anganwadi, as a major burden on the State’s budget.

Stating the State’s concern to have a committed expenditure covered through the Revenue Deficit Grants, which he noted, has been a critical factor for maintaining financial stability.

“A good grant will ensure that we are in a sound financial health and avoid borrowings to cover the shortfall in revenue expenditure and also earmark more funds for development and address unique local issues,” he added. 

The CM also highlighted the current financial year 2024-25, the State plan outlay which stands at Rs. 1010 crore, out of which Rs 250 cr is earmarked as 10% State’s matching share to CSS (Centrally Sponsored Scheme) leaving an amount of Rs760 cr only for the State’s own developmental programmes ‘which is far too less to have any noticeable impact.’

As Nagaland lacks the means to address these issues, he proposed the Commission for grants to compensate for the capital deficit to provide an enabling atmosphere for development, which can gradually reduce the state dependence on Revenue Deficit Grants over a period of time. 

To this, the State has accordingly proposed an amount of Rs. 40386.5 cr.

Major project proposals from Nagaland 
Trans Nagaland Highway: Among Rio’s proposals to the Commission were critical infrastructure projects including the Trans Nagaland Highway with the expected project cost amounting to Rs 9000 cr. This 364 km road along the Assam border will serve as many as 11 lakh population as per 2011 census as it connects key districts, he said, adding that it holds immense potential to boost Nagaland’s economic growth and promotion of Special Economic Development Zones (SEDZ) as it passes through mineral and agriculture belt.

Ciethu Airport: The State Government has acquired 1013.72 acres of land at Ciethu for a new airport with an estimated costs ranging from Rs 5,695 to Rs 8,870 crore, Rio informed that Commission.  The State Government has proposed for taking up for building an airport at Ciethu, for operating ATR 72 class of aircraft with ample provisions kept for future expansions to A320 in a phased manner.

IISER: Another project, Rio outline was setting of the Indian Institute of Science Education and Research (IISER) which was proposed in 2015-16 but yet to materialise. IISER would not only serve as a prestigious National Institute but also act as a catalyst for enhancing youth development and regional integration, he added. 

New High Court Complex: Stating that this project did not get the support of GoI under any scheme and the State Government has incurred an expenditure of Rs 162.80 cr, Rio informed that Commission that an amount of Rs 379 cr is required to complete the remaining work and finish the project.

Forest Conservation: Meanwhile, he also urged the Commission to increase allocations for forest conservation, noting that Nagaland’s unique community-owned forests cover nearly 98% of its forest land, but receive limited support compared to national averages. 

While Externally Aided Projects (EAPs) are crucial for bolstering a state’s resources, he suggested either eliminating or significantly increasing the expenditure ceiling on EAPs for smaller states like Nagaland.

The CM also made additional request for support to modernise power systems in the state, advocating for funds to support new municipal bodies, formed after a 22-year delay, traditional village councils and new building infrastructure developments amounting to Rs 7884.80 cr.

Rio expressed optimism that the XVIFC would empower Nagaland to embark on a transformative journey of economic progress and contribute significantly to India’s national development.