Centre clears ₹2,924-crore extra borrowing for Kerala tied to State’s power reforms, says Electricity Minister K. Krishnankutty

The Centre has sanctioned an additional borrowing space worth ₹2,924 crore to Kerala. The approval is tied to power sector reforms implemented by the State, Electricity Minister K. Krishnankutty said on Tuesday.

Under Central government initiative, an additional borrowing space of up to 0.5% of the Gross State Domestic Product (GSDP) is available to States as incentive for implementing reforms in the power sector.

The amount sanctioned now accounts for 0.22% of the State’s GSDP, Mr. Krishnankutty said. It will reflect in Kerala’s open market borrowing space for the 2026-27 fiscal.

Inclusive of this amount, the State has so far received approval for borrowing ₹46,623 crore from the market, the Minister said. He also termed the Centre’s decision “an acknowledgement of the operational efficiency” displayed by the State in the power sector.

Mr. Krishnankutty added that additional documents related to the reforms implemented by the State would be implemented on Tuesday itself. This will make the State eligible for additional borrowing space, he said.