Business Standard

15th Finance Commission: Moving on

Since the 10th FC, the most important parameter in the horizontal devolution formula has been the income distance criterion

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Rathin Roy
The terms of reference (ToR) of the 15th Finance Commission (FC) have generated unprecedented debate and controversy. 

The most publicly debated ToR is the requirement that the 2011 Census be used as the basis for using population in the formula for horizontal devolution, instead of the 1971 population, which was what was enjoined on previous Commissions. V Bhaskar, my colleague from the 13th FC, argues that this would result in the southern states losing out. I don’t think this argument carries any ex ante validity. The impact on the share of a state of a particular criterion depends on its
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper

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