“K’taka receives 76% more funds in one year”: Nirmala Sitharaman
Union Finance Minister Nirmala Sitharaman on Sunday dismissed allegations by the Karnataka government that the Centre has been withholding funds, asserting that the state is receiving substantially higher financial support under the current dispensation than it did during the UPA era.
Addressing concerns over tax devolution and central assistance, Sitharaman said Karnataka is slated to receive ₹63,000 crore in tax devolution in the 2026–27 financial year. She noted that this single-year allocation is 76% higher than the total tax devolution the state received during the entire 10-year tenure of the UPA government between 2004 and 2014.
The Finance Minister accused the Congress-led state government of presenting a misleading narrative regarding Centre-state financial relations. Citing official figures, she said central transfers to Karnataka have witnessed a significant rise since 2014.
According to Sitharaman, Karnataka received nearly ₹4 lakh crore in tax devolution between 2014 and 2026, compared to about ₹82,000 crore during the UPA’s decade in office. She further highlighted that grants-in-aid to the state increased from around ₹60,000 crore under the UPA government to approximately ₹2.71 lakh crore during the tenure of the Narendra Modi-led government.
She also pointed to the Centre’s support for infrastructure development, noting that Karnataka has received nearly ₹18,000 crore under the Special Assistance to States for Capital Investment scheme, which offers 50-year interest-free loans for capital expenditure projects.
Reaffirming the Centre’s commitment to cooperative federalism, Sitharaman said the Union government continues to support states through tax devolution, grants, and capital investment assistance. She urged stakeholders to rely on official data and factual assessments while discussing Centre-state financial relations, emphasizing the need for constructive cooperation between the Union and state governments.
