Members of the XVI Finance Commission, chaired by Dr. Arvind Panagariya, visited Kohima, Nagaland, where discussions centered around the state’s financial challenges. The Government of Nagaland has submitted a unique proposal seeking ‘Capital Deficit Grants’ from the Commission to address infrastructure and governance shortfalls accumulated over the years. This request aims to leverage Nagaland’s revenue potential while emphasizing green growth and sustainable development.
Dr. Panagariya noted that this proposal marks a first for any Finance Commission, given that previous commissions have not allocated capital grants in this manner. He acknowledged Nagaland’s high GDP and GSDP to debt ratios and rising fiscal deficits as growing concerns for macroeconomic stability, echoing similar issues faced by other states.
During the meeting, the state reiterated its fiscal challenges and specific requests. The Finance Commission is tasked with advising on the distribution of national resources between the central and state governments, considering factors like per capita income, population, and forest cover. It also recommends grants for local bodies, disaster management, and sector-specific needs.
Nagaland has requested inclusion in the cesses and surcharges, arguing for a greater share in the divisible pool to offset current losses. Additionally, the state proposed increasing the forest cover weightage from 10% to 15% in the horizontal distribution formula to reflect its extensive forest lands and modifying related criteria. They also introduced a ‘disability index’ to account for challenges arising from Nagaland’s terrain affecting economic activities.
The state government outlined specific project grants for infrastructure development, such as airports, foothill roads, and hydroelectric projects, in its submission. Dr. Panagariya recognized that while the Commission’s recommendations are still preliminary, addressing macroeconomic imbalances in states like Nagaland remains a priority.
Original Story https://www.morungexpress.com/nagaland-proposes-capital-deficit-grants-to-overcome-accumulated-deficit
Category : Nagaland
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Publish Date: 2024-11-06 04:14:00
