The decision was taken during a meeting of the High Level Committee chaired by Home Minister Rajnath Singh.
The Committee examined the proposal based on the reports of the Inter-Ministerial Central Team (IMCT) which visited the states.
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Vice Chairman, NITI Aayog, Arvind Panagariya, Home Secretary Rajiv Mehrishi and senior officers of the Ministries of Home Affairs, Finance and Agriculture attended the meeting.
The Karnataka government had sought a central relief of Rs 4,702 crore for loss of 2016 kharif crops because of severe drought in the state.
The state has been facing severe drought for the past six years. The drought in 2016-17 was the worst in 40 years. It has declared 139 taluks out of 176 drought-hit.
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