Sikkim Chief Minister Calls for Easier Funding Norms for Externally Aided Projects

PTI, June 19, 2026, Gangtok: Sikkim Chief Minister Prem Singh Tamang on Friday batted for a more equitable funding mechanism for externally aided projects, urging the Centre to ease financial burdens on the northeastern states while fast-tracking project approvals.

Speaking at a seminar on externally aided projects (EAP) in Shillong, chaired by Union Finance Minister Nirmala Sitharaman, Tamang raised concerns over challenges faced by states in accessing and implementing such projects.

According to an official statement, Tamang thanked the Centre for its continued support to Sikkim, and argued that the current EAP funding mechanism places an excessive burden on state finances despite substantial backing from multiple agencies.

“The requirement of significant counterpart funding places considerable pressure on financially constrained Himalayan and North Eastern states,” the statement quoted the chief minister as saying.

He proposed that EAPs in these regions follow the pattern of Centrally Sponsored Schemes, with 90 per cent grant support from the Government of India and only 10 per cent loan assistance.

Tamang also urged the Centre to allow the loan component of EAPs to remain outside prescribed fiscal deficit limits, contending that such projects generate long-term productive assets and critical infrastructure.

The chief minister also flagged lengthy approval procedures, noting that many externally funded projects take two to three years to secure clearance, escalating costs and repeated revisions.

He called for a fixed appraisal and approval timeline within a single financial year to accelerate implementation.

Tamang further pressed for regular capacity-building programmes for state officials, greater transparency in project approvals, and recognition of land, right-of-way and enabling infrastructure provided by states as part of their contribution to projects.

Highlighting Sikkim’s track record, Tamang noted that the state has successfully implemented externally aided projects in sectors such as power, forestry, connectivity and welfare programmes for women and youth, contributing significantly to socio-economic development.