Dehradun: The 16th Finance Commission, which visited Uttarakhand, has praised the financial management of Uttarakhand. Commission Chairman Dr. Arvind Panagariya said that if there is a balanced fiscal deficit in any developing state, then it is not a bad situation. Yes, it is important to ensure that this deficit does not increase. He said- Uttarakhand is aware of the financial challenges and is working in the right manner. He said that the state is making efforts to increase its income. There is every possibility of increase in this.
While talking to journalists at the Media Center in the Secretariat on Monday, Dr. Panagariya said that the per capita income of Uttarakhand is good. It is more than the national average. It can be increased further. In response to a question, he said that all the commissions formed till date have made arrangements keeping in mind the specific geographical conditions of the Himalayan states. He explained in detail the system of tax sharing between the Center and the states. He said that the Finance Commission determines the method and formula to divide the income obtained from tax between the Center and the states in accordance with the constitutional system and requirements.
Dr. Panagariya said that in the formula presented by the Commission for tax division between the Center and the states, standards have been set for determining the revenue share. Demographic performance (based on low fertility rate) has been kept at 12.5 percent, income gap at 45 percent, population and area at 15 percent each, forest and ecology at 10 percent, tax and fiscal management at 2.5 percent. In response to a question, he said that full attention is paid to the development of local bodies and panchayats during budget allocation. It also depends on the states how they work according to the released budget.
