New Delhi/Chandigarh, Jan. 11 -- Finance minister Harpal Singh Cheema on Saturday urged the Union government to extend immediate fiscal assistance and announce a special economic package for Punjab, stressing that the state has endured an extraordinarily difficult year marked first by heightened India-Pakistan border tensions and then by the worst floods witnessed in decades in 2025. During a pre-budget meeting with Union finance minister Nirmala Sitharaman in New Delhi, Cheema submitted a detailed memorandum laying out Punjab's key financial requirements and policy demands for the Union Budget 2026-27. Cheema said that Punjab suffered severe economic disruption due to prolonged tensions along the international border, followed immediately by a devastating monsoon disaster that was officially declared a calamity of severe nature by the ministry of home affairs (MHA). He informed Sitharaman that comprehensive ground-level assessments have pegged the total damage at Rs.12,905 crore. "To manage rehabilitation and reconstruction arising from such extraordinary circumstances, Punjab requires fiscal flexibility," he said, formally requesting permission for a one-time additional borrowing limit of 1% of Gross State Domestic Product (GSDP) for 2025-26 under the FRBM (Fiscal Responsibility and Budget Management) Act provisions applicable during natural disasters and national security emergencies. Cheema sought special central assistance of Rs.1,000 crore for the modernisation of the police force, strengthening emergency response systems, and deploying advanced anti-drone technology to effectively counter cross-border threats and narcotics trafficking. "As a border state bearing a disproportionate security burden, this support should be seen as cooperative federalism in action, not as a concession," he said. Cheema flagged the issue of withheld rural development fund (RDF), urging the Centre to immediately release the pending amount of Rs.7,757 crore calculated up to June 2025. "These funds are critical for maintaining rural roads and infrastructure," he said. He also requested that the incentive be increased to Rs.15,000 per acre to drive real behavioural change among farmers to reduce paddy cultivation and safeguard groundwater resources. Cheema further said that Punjab suffered a severe and continuing revenue shock following the implementation of GST 2.0. "Punjab is facing an annual revenue loss of nearly Rs.6,000 crore, which amounts to around 44% of its own tax revenue," he said. He strongly pressed for a predictable GST stabilisation or compensation mechanism for states facing such structural revenue erosion, stating that the fiscal sustainability of states cannot be compromised. Cheema also expressed strong opposition to the proposed changes to the MGNREGA framework, arguing that the new model dilutes the employment guarantee and transfers a significant financial burden to the states. He called for the restoration of the original demand-driven structure and funding pattern of the scheme....