Kerala finance minister Thomas Isaac said on Friday that the Rs 20,000-crore economic stimulus package announced by the chief minister in view of the coronavirus crisis would be financed by withdrawing at the earliest from the Reserve Bank’s yearly lending allocation for the state.

“It’s very simple. We are frontloading the borrowings of the new fiscal which is otherwise used in the latter part of the year,” Isaac told The Telegraph on Friday. Frontloading means uneven distribution or allocation of funds, with the greater proportion at the beginning of the process.

Since the new borrowings from the RBI start in April each year, Isaac has already written to Union finance minister Nirmala Sitharaman seeking permission to borrow immediately.

“We will borrow from the RBI by way of SLR (statutory liquidity ratio) bonds. Our state is entitled to borrow Rs 25,000 crore by way of SLR bonds, a facility available to every state. We will utilise Rs 20,000 crore needed for the stimulus package and keep the rest for future needs,” he said.

On Thursday, chief minister Pinarayi Vijayan announced a Rs 20,000-crore package to help those economically crippled by the virus that has shut down income-generating activities.

“We need the money to inject some confidence in the people and the retail market, which has taken a big hit. With this borrowing we are designing the schemes so that the immediate needs are met,” Isaac said.

Asked what he would do in case of any more financial emergencies later in the year, Isaac said: “We’ll cross the bridge when it comes.”

He also hoped that the Centre would offer a stimulus package to revive the flagging economy hit by the coronavirus-induced slowdown. “I hope they (Centre) will come up with their own package in some time to help revive the economy,” Isaac said.

The Kerala government had earlier considered other options like borrowing from the Malayali expatriate community. “But we didn’t go forward with the idea because of the problems they too are facing owing to the economic slowdown in their countries, and now this virus,” Isaac said.

Expatriates had been among the major contributors during the floods of 2018, the worst in a century, after the Centre ignored repeated pleas for funds and refused foreign aid offered by several countries.

“It is wrong to trouble our brethren who are facing their own problems in the countries they live in. But otherwise our expat community has always been a great help to Kerala,” Isaac said.

Chief minister Vijayan had in his announcement on Thursday advanced the rural employment guarantee scheme (MGNREGA) that usually takes off after monsoon each year.

“We used to give them (beneficiaries) jobs under the scheme after every monsoon when many of them are forced to sit idle. But this time we thought it would be better to advance the scheme to help workers who are sitting home because of the coronavirus outbreak,” Isaac clarified.

As part of the stimulus package the chief minister wants to ensure that poor people have some money in their hands, with the government planning advance payment of social security pension, distribution of free food grains for a month to all ration card-holders, opening 1,000 food outlets offering subsided meals at Rs 20 each, giving out consumer loans through the Kudumbashree project, offering tax rebates to the transport sector and the film industry, and allowing a month’s grace period for paying electricity and water bills.