Devolution of shares: A.P. wants ‘income distance’ weightage to be reduced to 30%, says Finance Commission Chairman

Prime Minister N. Chandababu Naidu, with the 16th President of the Finance Commission, Arvind Panagariya, the visit of the Charter to the Secretariat in Velagapudi on Wednesday. | Photo credit: special arrangement

Vijayawada

Andhra Pradesh’s prime minister has suggested that the 45% weight assigned to the ‘income distance’ (difference in the income of the capita states) in the formula to develop the participation of the states of fiscal income by the center, said Reduarman Arvtie -Saus.

15^Th The Finance Commission had assigned a weight of 45% to the ‘income distance’ in the formula related to the return of participation to the states.

Mr. Naidu also wanted the weight given to the population and the criteria of the total fertility rate (TFF) to be analyzed comprehensively, Panagariya told the media on Wednesday.

A delegation from the 16th Finance Commission led by Mr. Panagariya visited the Andhra Pradesh Secretariat on Wednesday.

Mr. Panagariya said that Andhra Pradesh favors reducing the weight of “income distance” to 30% to promote a spirit of competition between states to increase income with their own efforts instead of depending on the resource center.

Mr. Naidu suggested that the population’s weight is reduced from 15% to 5%, states must be encouraged to take measures for population growth, and the TFF must be linked to 2.1. In addition, the main minister proposes that the weight to the area be pruned from 15% to 5%.

In addition, Mr. Panagariya said that Naidu highlighted the necessary funds for the construction of the capital city in Amaravati as an “important need”, together with other projects carried out by the state government.

In addition, Mr. Naidu said the State had to fend for itself with ‘less resources’ and ‘less GSDP’ and more people such as bifurcation in 2014. To overcome this, the state government sought the support of the 16th Finance Commission.

Mr. Panagariya also said that the vertical return for financial commissions to states increased from 29.50% in 2000-2005 to 41%.

The quantum jump or 10% of 32% in 2010-15 to 42% in 2015-20 was large since the financial commissions are common and rarely change the status quo. The Divisible Revenue Group that will become the states as given by the 15th Finance Commission was 41%.

“We are open to suggestions and make informed decisions after making an exhaustive evaluation of the requirements of the states,” Panagariya added.