Kerala’s new United Democratic Front government to release White Paper on state finances: Chief Minister VD Satheesan

Freshly sworn in by Kerala Chief Minister VD Satheesan during an oath taking ceremony in Thiruvananthapuram on May 18, 2026. | Photo credit: PTI

One of the first announcements made by new Kerala Chief Minister VD Satheesan after taking charge on Monday (May 18, 2026) was that his government would soon release a White Paper on the state of state finances.

Kerala CM VD Satheesan presents the White Paper on State Finance in the Assembly

Speaking to reporters after the first meeting of the Congress-led United Democratic Front (UDF) government, Mr. Satheesan said an expert panel would be formed to draft the White Paper. The aim is to inform the people of Kerala about the current state of state finances, he said. According to him, the document will be published soon.

When Mr Satheesan and the UDF were in opposition, they consistently attacked the financial policies of the previous Left Democratic Front (LDF) government, accusing it of pushing the state into a debt crisis and failing to get the Center to release its rightful share of Kerala’s financial resources.

The future of KIIFB

It remains to be seen how the new UDF government would approach the Kerala Infrastructure Investment Fund Board (KIIFB), an entity restructured by the then LDF government in 2016 to mobilize funds for major infrastructure projects. In March 2017, Mr Satheesan himself, then in opposition, accused the then Finance Minister of the LDF government, TM Thomas Isaac, of using the KIIFB to circumvent the Constitution and the Fiscal Responsibility and Budget Management (FRBM) Act, ignoring the possibility that such a move could destroy Kerala’s economy. This parallel mechanism of raising funds through KIIFB was putting considerable pressure on the exchequer, he claimed then. The UDF felt vindicated when the Comptroller and Auditor General (CAG) later criticized the extra-budgetary loans from KIIFB, warning that they would push the state into a debt trap.

The LDF also posted

It is not the first time that a white paper has been proposed on the subject of state finances. In 2016, when the LDF government took over the Oommen Chandy-led UDF government, Finance Minister TM Thomas Isaac presented a white paper in the assembly. In 2023, the opposition UDF published its own white paper. The newspaper accused the LDF government of driving Kerala into a financial crisis and “toxic debt”.

Recently, the state’s finances were in the limelight when Mr. Satheesan noted after the UDF’s victory in the 2026 elections that the front had inherited an empty coffers from the LDF. Speaking to reporters, senior Congress leader AK Antony also claimed that Kerala is a poor state. He also advised people not to expect one populist measure after another from the new UDF government and some belt-tightening should be expected.

₹ 6,000 crore in cash

KN Balagopal, who was the Finance Minister in the 2021-2026 LDF government, countered Mr. Antony’s allegations and said that Kerala’s economy is not in a dangerous position as Mr. Antony makes it out to be. “Not only that, he is in a much better position,” Mr. Balagopal said at a press conference recently. This is evident from state government budgets for the last 10 years of LDF rule, CAG reports and Union government documents, he said. He said the treasury had a cash balance of ₹6,000 crore when the LDF government resigned.

Published – 18 May 2026 19:16 IST