The recent remarks of Karnataka Congress MP D.K. Suresh Kumar, that southern states would break away to form a separate nation, has sparked an unwanted controversy. D.K. Suresh Kumar is the brother of Karnataka deputy Chief Minister D.K. Shivakumar and Lok Sabha MP from Rural Bangalore. In reaction to Finance Minister Nirmala Sitharaman's interim budget on February 1, Kumar had also said that tax collected from states in the south was being spent on northern states. Bharatiya Janata Party (BJP) leaders at the Centre and in Karnataka criticised Congress leader Rahul Gandhi-who is currently on his second Bharat Jodo Yatra-for Suresh's comments. They also sought an apology from Congress chief Mallikarjun Kharge, who, in turn, distanced himself from the controversial remarks.
There has been an increase in north-south politics post the formation of the INDIA bloc. Alliance partners from south India, such as the Dravida Munnetra Kazhagam (DMK) in Tamil Nadu, the Congress in Karnataka (and now in Telangana too), and the Left in Kerala, for lack of any suitable election plank, have been raising provocative subjects to garner attention.
In December last year, DMK MP D.N.V Senthil Kumar had made a controversial remark in the Lok Sabha on the 'north-south divide' in the Lok Sabha, which sparked massive backlash. Senthil Kumar used pejorative words for the Hindi heartland states while attacking the ruling BJP after the party's wins in assembly elections in Madhya Pradesh, Rajasthan and Chhattisgarh.
A Needless Controversy
Just months before the Lok Sabha elections, Suresh, perhaps in an attempt to earn political mileage, has again stoked controversy by highlighting that the Centre is not giving southern states their rightful share of the GST and direct taxes. Whatever be the compulsions, such a polarising comment from an MP belonging to a national party like the Congress, is condemnable and sets a bad precedent. It's usually regional parties, anxious and insecure about losing their voter-base to a strong national party, which come up with such tales of imagined divides or biases. We've seen this strategy being employed in the past too by regional parties like the DMK, the All India Dravida Munnetra Kazhagam (AIADMK) and the Janata Dal (Secular) against the Congress.
Karnataka BJP chief B.Y. Vijayendra said Suresh's statement is irresponsible for an MP and goes against the spirit of our Constitution and national integration. "This reflects Congress's ideology and desperation to grab power and attention at any cost. Congress raking up a non-issue reflects their desperation to divert public attention from their failed administration and their frustration at not being able to keep their promise of implementing the five guarantees of the budget in Karnataka," he says.
Why Southern States Are Unhappy
Historically, the Finance Commission upon its inception had felt that poorer states, which are unable to meet their minimum resource requirements in tax revenues and central devolution, will need additional support from the Centre. Thus, the quantum of grants-in-aid to each state depends on its economic condition. The unhappiness of southern states over financial devolution is not new. Of late though, this sentiment has intensified.
The contribution of the five southern states (Karnataka, Tamil Nadu, Telangana, Andhra Pradesh, and Kerala) to the gross Central tax kitty has grown enormously in recent years. Logically then, they want to spend more too. The five states, for instance, accounted for over 26% of GST collections in December 2023. In the fiscal year 2021-22, the five states contributed 26% to the gross direct tax collections (income tax and corporation tax) of the Centre. Whereas under the 15th Finance Commission award, the combined share of these states in the divisible pool of central tax revenue is 15.8%. This is down from a 17.98% combined share for these states according to the 14th Finance Commission award. Only Tamil Nadu's share went up, marginally, from 4.02% o 4.08%.
"In election-time politics, the line peddled by Congress leaders is dangerous. Never since the first Finance Commission in 1952 has tax collection in a state been a principle of tax devolution or resource transfer from the Centre. Perhaps, before Bengaluru emerged as one of the key economic drivers of the country's economy, Karnataka would have been a beneficiary of this approach of successive Finance Commissions," says K. Subrahmanya, a senior political analyst based in Bengaluru.
The Pressure of Funding the 'Five Guarantees'
A deep-dive into the financial statements of the Interim Budget reveal that no such gross injustice has been meted out to Karnataka. According to latest reports after the Interim Budget, the Centre will devolve a total of Rs 12.19 lakh crore of taxes and duties to states. In this, Karnataka's share is 3.65%, as fixed by the 15th Finance Commission. Karnataka's share in tax devolution fell from 4.71% under the 14th Finance Commission to 3.65% under the 15th Finance Commission. Despite the drop, the Centre will devolve Rs 44,485.49 crore to Karnataka as the State's share in taxes and duties for the 2024-25 fiscal. The Siddaramaiah government had projected that Karnataka would receive Rs 41,483 crore under devolution in 2024-25, and raised a hue and cry over it. So, what after all is the reason behind the Karnataka MP's tirade?
Perhaps the answer lies in the Siddaramaiah government's allocation or rather the diversion of funds for electoral freebies in the name of 'five guarantees'. The 'five guarantees' of the Congress that led to its stupendous victory in the May 2023 assembly elections have drained the state's coffers. The extra sum of Rs 37,252 crore will come in handy for the Chief Minister to fund his five guarantees, which cost Rs 55,000 crore. The Chief Minister, who will present his record 15th budget on February 16, faces huge pressure to fund the guarantees at least till the election year. Exactly how he will manage to do that will be widely observed.
"People have lost all hope from this government in just a few months of coming into power. Not a single development project has been announced in the last ten months, which shows the government's apathy towards development," says Vijayendra.
Essentially, it's the pressure of electoral politics that has prompted I.N.D.I.A constituents like the Congress and the DMK to spread false narratives to capture voters' attention. Rhetoric and provocation must not be used as a tool by elected representatives to score over their political adversaries. But it's also impractical to expect politicians who are deprived of ideas to contest the 2024 general election on the plank of development.
(Bharti Mishra Nath is a senior journalist)
Disclaimer: These are the personal opinions of the author.