Implications of the Sixteenth Finance Commission on state finances
By: Pradeep, Kamble
.
Material type: 
BookPublisher: Economic & Political Weekly Description: 61(19), May 9, 2026: p.59-66.
In:
Economic & Political WeeklySummary: The fiscal implications of the Sixteenth Finance Commission’s transfers on state governments are examined. The Sixteenth Finance Commission introduces significant changes in the inter se distribution among the states compared to the Fifteenth Finance Com¬mission. The paper analyses the implications of these changes for states’ revenue deficits, their ability to meet the Fiscal Responsibility and Budget Management Act targets, and capital expenditure. It also assesses the extent of fiscal adjustment in states, the fiscal behaviour required to sustain adquate capital expenditure and the feasibility of such adjustments. The analysis suggests that, owing to enhanced transfers recommended by the Sixteenth Finance Commission, a few high-income states are likely to generate substantial revenue surpluses, whereas many middle-income and north-eastern and hilly states may experience revenue deficits. Consequently, middle-income and NEH states are likely to face difficulties in maintaining adequate capital expenditure and comply with FRBM targets, with some requiring corrective changes in fiscal behaviour and additional federal fiscal transfers.- Reproduced
https://www.epw.in/journal/sixteenth-finance-commission/implications-sixteenth-finance-commission-state.html
| Item type | Current location | Call number | Vol info | Status | Date due | Barcode |
|---|---|---|---|---|---|---|
Articles
|
Indian Institute of Public Administration | 61(19), May 9, 2026: p.59-66 | Available | AR139189 |
The fiscal implications of the Sixteenth Finance Commission’s transfers on state governments are examined. The Sixteenth Finance Commission introduces significant changes in the inter se distribution among the states compared to the Fifteenth Finance Com¬mission. The paper analyses the implications of these changes for states’ revenue deficits, their ability to meet the Fiscal Responsibility and Budget Management Act targets, and capital expenditure. It also assesses the extent of fiscal adjustment in states, the fiscal behaviour required to sustain adquate capital expenditure and the feasibility of such adjustments. The analysis suggests that, owing to enhanced transfers recommended by the Sixteenth Finance Commission, a few high-income states are likely to generate substantial revenue surpluses, whereas many middle-income and north-eastern and hilly states may experience revenue deficits. Consequently, middle-income and NEH states are likely to face difficulties in maintaining adequate capital expenditure and comply with FRBM targets, with some requiring corrective changes in fiscal behaviour and additional federal fiscal transfers.- Reproduced
https://www.epw.in/journal/sixteenth-finance-commission/implications-sixteenth-finance-commission-state.html
There are no comments for this item.