There are differences of opinion among economists whether the KIIFB (Kerala Infrastructure Investment Fund Board) model is the most appropriate way to address the state's dearth of economic investment in development. Several have warned that the excessive indebtedness and high interest because of KIIFB would push the state into an economic emergency. There are as many who who support the concept as those who raise reproach citing the opacity in its mode of operation on one hand and on the other the liability that will accrue to the state due to the fact that the beneficiaries of the funds are non-productive entities.
As per the documents tabled in the state assembly by finance minister Thomas Isaac in June 2016, the state loans accounted for Rs 1.57 lakh crores. After five years, as the Pinarayi government looks forward to the next elections, these loans have risen over Rs 3.5 lakh crores. Therefore, KIIFB, which has become the most crucial nodal agency in fundraising for government projects, should be one of the main topics of discussion in the upcoming elections. Unfortunately, instead of such developmental and economic analyses, what is emerging here are unhealthy and untrue political allegations and counter-allegations. The issue is further complicated by the Centre's excessive interference in it in the form of probe by ED (Enforcement Directorate).
ED has registered a case for alleged violation of the Foreign Exchange Management Act (FEMA) which alleges that the loans of KIIFB are not in accordance with the Constitution and the masala bond released by it is an encroachment on the powers of the central government under the Seventh Schedule, Article 37, first list of the Constitution. As soon as the CAG (Comptroller and Auditor General) report was out, the ED sought details about KIIFB's economic transactions from the RBI on November 20, 2020. KIIFB CEO K.M Abraham, Deputy MD Vikramjith Singh, and their major bank Axis Bank's officials have received summons for questioning. Both the ruling party CPI-M and the government have decided to publicly challenge and resist the ED. Vikramjith Singh did not appear in response to the summons. Thomas Issac has strongly condemned the ED and the Centre. The chief minister has also written to the Chief Election Commissioner that the investigation agencies are bowing to the Centre's pressure and defying protocol. KIIFB, itself has written to the ED demanding they move away from politically motivated steps.
The CPI-M has taken a decision to face the people explaining the move as an authoritarian misuse of power by the Centre and as the Centre's political conspiracy against the state. With the UDF also moving to defend itself in the run-up to the elections, the controversy over KIIFB is bound to get hotter. We have in the Centre, a government that goes to any extent to bring down its opponents- by choking the states and killing federalism, and has no qualms about employing investigation agencies to rein in adversaries. Every day there are incidents strengthening the inference that the ED and the National Investigation Agency have degenerated into a system to imprison political opponents and facilitate the rise of the Sangh Parivar to power. Income tax officials raided the homes and offices of Bollywood director Anurag Kashyap and actress Taapsee Pannu, both of whom have publicly spoken out against the Centre. In Tamil Nadu and West Bengal, investigators have been providing escort to the BJP's alliance talks and defection politics. The case against KIIFB is merely an extension of this hegemonistic politics that cuts at the roots of democracy. Even while criticising the state government in the matter of KIIFB, it is imperative to challenge above party differences, the Centre's approach of caring little for the state and governmental machinery, that too when an election is at the door step.