Guwahati: Three months after the imposition of President’s Rule in Manipur, Governor Ajay Kumar Bhalla has approached the Central government with a request for Rs 1,000 crore in special financial assistance to help stabilize the state’s economy.
The ethnic violence that erupted over two years ago has severely impacted revenue collection and disrupted public administration, prompting the urgent plea, according to officials familiar with the matter, The Indian Express reported.
Ready for a challenge? Click here to take our quiz and show off your knowledge!
Governor Bhalla has also urged the Centre to immediately release Rs 500 crore from the proposed amount to address pressing financial obligations, including clearing pension backlogs and covering security-related expenses.
The Union Finance Ministry has reportedly approved an initial release of Rs 500 crore for various infrastructure and development initiatives under the Special Assistance to States for Capital Investment (SASCI) scheme for 2025–26.
In a communication sent to Finance Minister Nirmala Sitharaman in May, Bhalla highlighted the severe dip in the state’s tax revenue following the ethnic unrest in May 2023.
Ready for a challenge? Click here to take our quiz and show off your knowledge!
He informed the ministry that the violence had not only undermined economic activity but also hindered the state’s capacity to meet essential commitments such as pension disbursals and salary payments. He pegged the current pension backlog at approximately Rs 600 crore.
According to the Governor’s assessment, Manipur’s tax revenue stood at Rs 1,528 crore in FY 2023–24, only marginally up from Rs 1,554 crore the previous year, suggesting a stagnant recovery. In contrast, revenue collection had reached Rs 1,983 crore in FY 2022–23, before the unrest deepened.
Bhalla also flagged the pending reimbursement of Rs 300 crore from the Ministry of Home Affairs for expenditure incurred on relief and law enforcement efforts.
He emphasized that the requested Rs 1,000 crore assistance would help Manipur meet obligations under Centrally Sponsored Schemes, finance security operations, and fund relief for displaced persons. The aid would also support rural development projects, particularly in the state’s hill districts.
The Governor further noted that Manipur has been unable to claim grants worth Rs 629 crore under the 15th Finance Commission due to delays in conducting local elections. The state hasn’t held polls for Urban Local Bodies and Autonomous District Councils since 2020, nor for Panchayati Raj institutions since 2022, which are prerequisites for accessing those funds.
Previously, the Finance Ministry had allocated Rs 500 crore in two tranches as special assistance to offset revenue loss and stimulate economic recovery. The state reportedly utilized the full amount.
Before this, former Chief Minister N. Biren Singh had also requested additional Central support. In October 2023, Singh had sought a three-month advance of Manipur’s share of Central taxes, citing a dire financial situation caused by continuing ethnic tensions.
He had also appealed for Rs 2,000 crore in special financial support and proposed a dedicated housing scheme under PM-AWAS for 5,000 families affected by the violence.
Governor Bhalla’s current appeal brings renewed focus to Manipur’s ongoing struggle to recover from prolonged conflict and highlights the fiscal pressures confronting states grappling with large-scale displacement and insecurity.