East-South divergence: The glaring skew in the revenues of Indian states

While equalisation of state finances and of Lok Sabha representation can't be addressed simultaneously, persisting with inequalities is no one's prescription for national unity, writes T N Ninan

Globally, we are living through the Great Convergence, when many of the poorer nations have been growing their incomes faster than the wealthier ones, thereby closing some of the gap between the two groups. What about convergence within the country, between the poorer and richer states? The hard truth is that there is none. Instead, there is only divergence.

Consider tax revenue. Madhya Pradesh has half the tax resources of Karnataka (not counting transfers from the Centre), with a population that is 20 per cent bigger. UP has two-and-a-half times the population of Tamil Nadu, but broadly similar tax resources.