'Contributions in those economies are not...': Nirmala Sitharaman addresses Budget gripe of southern states

Finance Minister Nirmala Sitharaman in an interview said  southern states should acknowledge the benefits of labor when they talk tax devolution with the Finance Commission. In an interview to NDTV profit, Sitharaman said these states (Tamil Nadu, Kerala, Telangana, Karnataka and Andhra Pradesh), with higher socio-economic development, should highlight their developmental indicators while acknowledging how they have thrived due to the mobility of labor and capital within the country.

"The contributions in those economies are not exclusively by people of that state alone. Today's mobility of labour being what it is, mobility of capital being what it is, states are approaching both labour and capital issues in such a way that they are drawing the best in the country," she told the channel.

Responding to the criticism from non-NDA southern states about potential revenue declines due to better-managed population growth, Sitharaman encouraged these states to engage with the Finance Commission, presenting their achievements and human development indicators. 

"Developmental indicators of states must also be looked at, including the human indicators. We will have to do whatever it takes to bring the entire nation to the same level," she emphasized.

Despite the opposition's claims of neglect, Sitharaman reiterated that the budget reflected Prime Minister Narendra Modi's vision of simplicity and transparency, ensuring that financial changes are communicated openly and are understandable by the general public. 

She also noted that while specific states might not be mentioned in the budget speech, this does not imply any omission in funding.

Sitharaman said no state was denied its share in the 2024 Union Budget, countering criticisms that only Andhra Pradesh and Bihar were mentioned in her budget speech. She clarified that the allocations are consistent with past distributions and mandated support for Andhra Pradesh post-bifurcation in 2014. 

"States are receiving allocations as they have in the past... no state has been denied anything," she asserted, addressing the opposition's concerns.

The Finance Minister also addressed the contentious issue of petrol and diesel taxation, explaining that while these fuels are currently taxed under VAT, provisions for their inclusion under GST are already in place. 

"If they fix the rate and they all come together and decide that GST will include petroleum products, then we can implement it immediately," she stated, highlighting the need for consensus among states within the GST Council.