The Centre yesterday set-up a sub-committee to assess the financial requirements of Jammu and Kashmir for the current financial year.
The committee will chalk out the fiscal reforms the state government should implement to boost its finances over three to five years. Members of the comprises, which comprises senior officials of the finance and home ministries, Planning Commission and the state government, will meet on November 22.
The decision was taken after a meeting between state Chief Minister Farooq Abdullah and representatives of the Central government including Union home minister L K Advani and finance minister Yashwant Sinha.
Deputy chairperson of the Planning Commission, K C Pant, home secretary Kamal Pandey, chief secretary Ashok Jaitley and senior officers of the army, Border Security Force and the intelligence also attended the meeting.
The meeting took place against the backdrop of Abdullah's threat to resign if the Centre failed to meet the state's financial and security needs.
It was held in two phases--one to discuss the state's security needs and the other on financial aspects. "There was earnestness to understand the financial difficulties being faced by the state and find a solution thereof," Advani told reporters after the meeting.
The Centre will extend the necessary financial assistance to Jammu and Kashmir and continue anti-militancy operations with full vigour, he said. However, he asked the state to maintain financial discipline and ensure that the benefits of additional funds reached the common man.
Advani said the Centre had agreed to the state's demand for a development plan. However, the state's demand to waive off Rs 1,250 crore loan has to be first examined by the sub-committee.
