The Sixteenth Finance Commission, led by Chairman Dr. Arvind Panagariya, held a press conference at Hotel Vivor in Kohima on 5th November 2024. This visit marked the 10th state in the Commission's nationwide tour, which began with Himachal Pradesh.
During the press briefing, Dr. Panagariya provided an overview of the discussions held with Nagaland’s officials, including Chief Minister, Deputy Chief Minister, and other cabinet members. The meetings covered Nagaland's unique needs and expectations from the Finance Commission, with Chief Secretary Nagaland highlighting the state's developmental progress.
Dr. Panagariya remarked that a significant part of the meeting involved a presentation by the Additional Chief Secretary, detailing Nagaland’s economic and financial landscape and what the state seeks from the Commission.
He added that the Finance Commission is responsible for advising on the vertical devolution of resources, which defines the division of the divisible pool between the Centre and states, as well as the horizontal devolution, determining how states’ shares are distributed between states based on criteria such as per capita income, population, forest area among others. In addition, the Commission also makes recommendations on the grants to be given to local bodies which come from the Consolidated Fund of India and it also make recommendations on disaster reliefs grants.
One of Nagaland’s main demands concerned the inclusion of cesses and surcharges in the divisible pool, which currently deprives the states of such funds. The Nagaland government also requested an increase in the weightage given to states’ forest cover in the horizontal distribution, proposing a 15% share for this factor, given the state’s significant forested areas in proportion to it's total land area.
Also, Nagaland urged the Commission to incorporate a "disability index," recognizing the challenges of the state’s hilly terrain, which increases costs of economic activities. The Chairman stated that the state also requested the consideration of Capital Deficit Grants to support capital projects that had previously been funded by the now-dissolved Planning Commission, as well as project-specific grants for infrastructure development, including airports, foothill roads, hydroelectric projects and others.
The Sixteenth Finance Commission also held meetings with Urban Local Bodies, Rural Local Bodies, political parties and also representatives of Trade, Industries, and Commerce.
(DPRO Kohima)
