After Delhi Outreach, Satheesan Faces Kerala’s Mounting Political, Fiscal Challenges

It has just been 10 days since V.D. Satheesan was sworn in as Chief Minister. Two trips to Delhi and now it appears that he already has many issues in his hands coming from the previous government. These include the  Munambam port, Kerala’s borrowing limits, remittances, financial crisis, and political issues. With the finance portfolio being held by the CM, it ensures a loaded plate.

One of the immediate problems faced by Satheesan as Chief Minister is the financial one. The continuation of the US-Israel-Iran war, will exacerbate problems for the state as it will reduce the remittances received by Kerala, which adds more financial pressure.

Satheesan’s first visit to Delhi after his swearing in was over last weekend to meet senior party leaders including party president Mallikarjun Kharge, the Gandhis and the party general secretary K.C. Venugopal, who had been a contender to the CM’s chair.

His first official visit to Delhi as Chief Minister included a meeting with the Prime Minister Narendra Modi and Union Finance Minister Nirmala Sitharaman on Tuesday, which was followed by meetings with the Union Home Minister Amit Shah and Union Ports Minister Sarbananda Sonowal on Wednesday. This visit was meant to gain financial benefits and fast-track infrastructure developments while fostering relations with the central government amid Kerala’s fiscal crisis.

During the press conference after meeting the Prime Minister and Sitharaman, Satheesan emphasised the fiscal challenges faced by Kerala. He said that the state government had allocated ₹5,580 crore for acquiring land to construct national highways and handed over the money to the National Highways Authority of India (NHAI). Kerala is hoping to have the above-mentioned expenditure deducted from its borrowing limit.

Satheesan argued that while Kerala’s borrowing limit under Gross State Domestic Product (GSDP) norms officially stood at 3 per cent, conditions attached to the borrowing framework had altered the effective fiscal space available to the state. Pending liabilities linked to the Kerala Infrastructure Investment Fund Board (KIIFB) and pension obligations continue to cast a shadow over state finances.

The Chief Minister further pointed out that the state government was considering whether Kerala had been allocated its due share of funds by various Union government departments. He emphasised that legal and administrative barriers would be taken care of to ensure that Kerala received its proper due through schemes run by the central government. He raised issues with regard to the MGNREGS scheme, which would now require states to bear the cost of 40 per cent as the union government would no longer fund the entire amount.

The financial distress confronting Satheesan is not new. Even in December 2025, the Kerala government Kerala had made a six-point memorandum to the Centre regarding the financial woes being faced by the State. It pointed towards financial shock to the state government revenues and fiscal borrowing constraints were among the critical factors behind the present scenario. Some of the demands included increasing the limit of net borrowing for Kerala by ₹3,323 crore, reviewing deductions associated with off-budget borrowing of the state-owned entities, reviewing borrowing limits after adjusting the estimates of GSDP, and allowing borrowing in order to compensate for nearly ₹6,000 crore that have been used for acquisition of land along National Highways.

Infrastructure and development projects featured prominently during the Delhi visit. The talks with Sarbananda Sonowal were mostly based on the plans of Kerala regarding port development and developmental schemes.

Yet finances are only one part of Satheesan’s crowded in-tray. Among the most politically sensitive challenges is the Munambam land dispute in Ernakulam district, the Chief Minister’s home turf and one that cuts across religious and political fault lines.

At the heart of the controversy lies a 404-acre tract of land occupied by around 600 Christian families who possess legal purchase documents. The dispute escalated after the Waqf Board entered the land in its register in 2019 and later uploaded details to the Union government’s centralised UMEED portal, reinforcing its claim over the property.

The Christian-dominated Munambam Land Protection Council has stated that it would  approach the Chief Minister seeking dismissal of the current Waqf Board, though a restructuring is expected following the change in government. For Satheesan, the issue is politically delicate. Christian residents expect intervention, while the Indian Union Muslim League (IUML), a key constituent of the United Democratic Front government, remains an important political ally and has so far avoided openly backing the Waqf authorities.

At the Delhi press conference and in Kerala, Satheesan alleged that the registration of the disputed land on the UMEED portal violated legal procedure. He questioned why the Waqf Board acted at the last minute in April ahead of elections, just before the previous government demitted office, and suggested that ministers in the former administration had enabled the Board’s confidence in asserting ownership.

The first controversy confronting Satheesan after taking office, however, emerged from within the administrative establishment. The appointment of former Chief Electoral Officer Rathan U. Kelkar as Secretary to the Chief Minister sparked criticism from the Opposition, including the BJP and the CPI(M), which questioned whether the posting was compensation for alleged favours during the election period.

Rejecting the charge, Satheesan insisted that Kerala’s situation was entirely different from controversies elsewhere, including West Bengal. He described Kelkar as an efficient officer and maintained that there had been no procedural violation. The Chief Minister also pointed out that Kelkar had been chosen as Chief Electoral Officer by the Election Commission of India from a panel of three Kerala cadre IAS officers submitted during the tenure of the previous Left Democratic Front government.

Satheesan must also navigate growing impatience within his own party over allegations of police excesses under the previous Left administration. Congress leaders have demanded action against officers accused of manhandling party workers during protests. What is under the scanner is the 2023 attack on Youth Congress workers during the Nava Kerala Sadas, where a Special Investigation Team probe reportedly found that a senior police officer altered the original case diary and investigation report. The DySP’s report had originally mentioned the availability of video recordings depicting police excesses. It was removed from the final report.

Congress leaders have accused ex-ADGP (Law and Order) M.R. Ajith Kumar of tampering with records, alleging that an officer of his rank could not have acted without authorisation from the Chief Minister’s Office under the previous regime. Congress MLAs are seeking acion against him.

Complicating matters further is the question of Congress organisation itself. A new Pradesh Congress Committee (PCC) president is expected to be appointed soon as the current KPCC president Sunny Joseph is now a minister. With working presidents A.P. Anil Kumar and P.C. Vishnunadh also being appointed as ministers, organisational changes are likely, including change in District Congress Committee (DCC) leadership.

The new person needs to be aligned with both Satheesan and the party general secretary KC Venugopal, without which there would be friction between the government and the organisation.

Meanwhile, politics in the state has already sharpened. A fresh war of words erupted after the Enforcement Directorate conducted searches linked to former Chief Minister Pinarayi Vijayan in connection with the alleged CMRL-Exalogic financial transactions case. The CPI(M) described the action as a politically motivated “Congress-BJP operation”, while both Congress and BJP leaders dismissed the allegation. BJP leader and former Union minister V. Muraleedharan retorted that Prime Minister Narendra Modi had “better things to do” than engineer political targeting of the CPI(M). Kerala Home Minister Ramesh Chennithala also dismissed the allegations and questioned CPI(M)’s backroom deals with the BJP.

For Satheesan, what has emerged between these two Delhi visits, is a growing financial crisis, a land dispute, administrative controversies, pressure from party ranks and sharpening political battles.