Finance Commission's dose of reality

The report of the Fifteenth Finance Commission is comprehensive and analytically rich. This is welcome at a time when there is little quality economic analysis emanating from the Government of India. The Commission has also accomplished a remarkable job, given the clumsy and normatively biased Terms of Reference (ToR) that it had to work with.

The analysis of the Central and state government finances is sound. The report also does a reasonable job of acknowledging the impact of the pandemic, and the prior structural growth slowdown, by projecting cautious recovery in nominal gross domestic product (GDP) growth to 11.5 per cent