The Kerala Government today has urged the Supreme Court to promptly form a five-judge Constitution bench to address its lawsuit against the Centre regarding the ceiling on net borrowing. The state challenges the Union government’s restrictions on its borrowing capacity, citing infringement on financial autonomy and unconstitutional directives. The matter awaits a decision by the apex court.
The Kerala government is locked in a legal battle with the Central Government over borrowing limitations, which the state argues impede its financial independence. The Supreme Court is deliberating on the dispute, emphasizing the need for negotiation. This case has significant implications for India’s fiscal federal structure, federalism principles, and states’ financial autonomy.
