Finance Commission expected to be constituted by November end: Finance secretary
New Delhi (PTI): The government is expected to constitute the 16th Finance Commission by end of November, finance secretary T V Somanathan said.
Finance Commission is a constitutional body that gives suggestions on Centre-state financial relations.
It suggests, among other things, the ratio in which tax is to be divided between the Centre and states for five years, beginning April 1, 2026.
"The Finance Commission is expected to be constituted by end of November because that's the statutory requirement," he told PTI in an interview.
Terms of Reference (ToR) for the commission is being finalised, he said.
The previous Finance Commission submitted its report on November 9, 2020, for the 5 fiscals -- 2021-22 to 2025-26 -- to the President.
The 15th Commission under N K Singh had kept the tax devolution ratio at 42 per cent -- at the same level suggested by the 14th Commission.
The central government accepted the report of the commission, and accordingly, the states are being given 42 per cent of the divisible tax pool of the Centre during the period 2021-22 to 2025-26.
The 15th finance commission's recommendations include the fiscal deficit, debt path for the Union and states, and additional borrowing room to states based on performance in power sector reforms.
As per the glide path for fiscal consolidation, the government aims to bring down the fiscal deficit to 4.5 per cent of gross domestic product (GDP) by the 2025-26 fiscal.
For the current fiscal, the deficit is projected at 5.9 per cent of GDP, lower than 6.4 per cent in the last fiscal ended March 31, 2023.
He also said the government will stick to the fiscal deficit target of 5.9 per cent of the GDP as robust tax, non-tax collections will help meet the spending requirement and make up for any shortfall in disinvestment proceeds.
Although there would be a shortfall with respect to disinvestment, he said, this shortfall would be met by non-tax revenue mobilisation.
"Disinvestment target is unlikely to be met. However, I would say in aggregate the collective amount between disinvestment and non-tax revenue is likely to be very close to the budget," he said.
The total of disinvestment receipts, plus non-tax receipts are likely to be very close to the Budget Estimates, he said.
"We expect to adhere to our fiscal deficit target this year...none of the events so far have caused anything for us to deviate from it," he said.
The government has already got a higher dividend from the Reserve Bank of India and expects higher dividends from public sector banks and other PSUs than estimated in the Budget.
The Reserve Bank of India in May approved a Rs 87,416-crore dividend payout to the central government for 2022-23, nearly triple of what it paid in the preceding year. The government was expecting Rs 48,000 crore from the RBI, public sector banks and financial institutions in the current fiscal.
The dividend payout by the RBI was Rs 30,307 crore for the accounting year 2021-22. With public sector banks posting record profits of over Rs 1 lakh crore in fiscal 2022-23, the government's earnings from them are likely to be higher.
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Kerala polls: Vijayan, Revanth Reddy trade barbs as campaigning ends
Kannur (Kerala)/Hyderabad (PTI): A war of words between Kerala Chief Minister Pinarayi Vijayan and his Telangana counterpart Revanth Reddy turned acrimonious on Tuesday, the final day of campaigning for the April 9 Assembly polls.
The two leaders sparred on the virtual world as well, exchanging letters on their respective social media handles.
The escalation came after Vijayan, responding to Reddy's earlier remarks, used Malayalam expressions considered nearly derogatory, signalling strong disapproval of the Telangana CM's comments.
Reddy, campaigning for the UDF in Kollam district, hit back swiftly, likening Vijayan to PM Narendra Modi.
He said he would take any personal remarks from the senior leader as a "blessing" considering his age, but objected to what he described as insults directed at the people of Kerala. "But you cannot abuse our Kerala people," he said, hours before campaigning drew to a close.
The controversy began after Reddy had said "nee po mone Vijaya" by invoking a famous dialogue from superstar Mohanlal's blockbuster movie "Narasimham" while referring to Vijayan on April 1 during a UDF campaign roadshow in Nemom constituency.
Earlier in the day, while reacting to Reddy's earlier remarks, Vijayan said a CM must maintain basic standards of conduct and questioned whether such dignity was being followed.
In his response to a query, Vijayan used Malayalam words that were seen as nearly derogatory for Reddy, signalling his strong disapproval of the remarks made against him.
Sharply reacting to the CM's objectionable remarks, Congress leader V D Satheesan said Vijayan appeared to have "completely lost composure" and warned that any further deterioration in his conduct would have brought "greater embarrassment" to the state.
After the critical remarks during the press meet, Vijayan wrote on his 'X' handle that political differences are natural, but expressing strong disagreement through personally insulting remarks is an attitude that he rejects. Reddy's statements lacked factual backing.
In a detailed letter attached with the 'X' post addressing the Telangana CM, Vijayan said the experience of the people of Kerala was "vastly different" from what Reddy had portrayed.
He clarified that he did not intend to engage in a debate over the performance of the Telangana government, stating that it was for the people of Telangana and political parties there to assess their government.
Referring to Reddy's comments, Vijayan said the LDF government has been consistently publishing progress reports over the past 10 years on the implementation of its election promises, underlining its commitment to continuous accountability.
He also rejected the allegation of "selective appropriation" of Kerala's achievements, including its top ranking in the NITI Aayog SDG Index, and said such criticism was misplaced.
Dismissing claims of industrial stagnation, Vijayan said Kerala has made significant strides in the startup ecosystem and ease of doing business, adding that these achievements have been widely acknowledged.
He also alleged that key infrastructure projects in Kerala, including the Kochi Metro and Vizhinjam Port, faced delays under previous Congress-led governments at the Centre, while long-pending promises such as a railway coach factory remained unfulfilled.
Vijayan further accused the BJP-led Union government of discrimination against Kerala and said the state has been actively resisting what he described as "anti-federal and undemocratic" policies through legal and political means, including approaching the Supreme Court.
He also rejected Reddy's criticism that the LDF was not vocal enough against the BJP, asserting that Kerala has been at the forefront of defending constitutional values.
Concluding his letter, Vijayan reiterated the state government's commitment to building a "Nava Keralam" and moving forward as a model for others.
On April 1, while addressing party workers in Nemom, Reddy used the popular Malayalam film dialogue "Nee po mone Vijaya". He adapted it to target Vijayan, saying "Nee po mone Vijaya".
Reddy went further, claiming that Vijayan's "time is over" and that his "expiry date has passed".
Responding to these allegations, Vijayan had said that the Telangana CM was "misinformed" and accused him of "ridiculing" Kerala and its people while trying to hide the weaknesses of his own state.
In a later response, Reddy defended his remarks and said that many of the statistics cited by Vijayan were taken from the NITI Aayog SDG Index 2023 24, arguing that the data was already outdated.
Reddy in his letter questioned the veteran Marxist leader's claim that Kerala would become the first state to completely eradicate extreme poverty by late 2025 had been achieved. Further, he chooses to conduct himself respectfully and gracefully in his criticism of the Kerala government's performance, whereas Vijayan opted to use language of poor taste.
Reddy, in his letter on X, said that while he respects NITI Aayog's corruption rankings, he wants to know why the infamous gold smuggling case, linked to individuals connected to the CMO, remains unresolved, and why 4.5 kg of gold allegedly misappropriated from the Sabarimala Ayyappa Temple has not been accounted for.
