Kerala government to host inter states conclave to discuss fiscal issues

Thiruvananthapuram (Kerala) [India], September 6 (ANI): tHE Kerala government will host an interstate conclave with five opposition-ruled states to discuss their fiscal needs in the upcoming 16th Finance Commission, state Finance Minister KN Balagopal said on Thursday. Besides the left-ruled Kerala, AAP ruled Punjab, DMK governed Tamil Nadu, and the Congress ruled states of Karnataka and Telangana will participate in the conclave.

The move is seen as an effort from the five opposition states to demand more funds from the NDA led central government. Kerala Finance Minister KN Balagopal said that the conclave will be inaugurated on September 12 by Chief Minister Pinatayi Vijayan, and the state opposition leader will also participate in that meeting.

“The states of Tamil Nadu, Karnataka, Telangana, and Punjab finance ministers are attending the conclave, KN Balagopal added.

Additionally, state Finance Ministers and Finance secretaries of five participating states will also take part in the conlave informed KN Balagopal. There will be detailed discussions about the different aspects of the finance commission in this conclave.

“There will be a very detailed discussion about the different aspects of the finance commission, how the states are representing them, and what the major issues are for considering,” the Kerala finance minister added.

He further stated that a group of very famous economists and administrative experts will also attend the conclave.

“Economists like Aravind Subramanyam, who was the former finance advisor of the union government, will also attend,” KN Balagopal said.

He asserted that this will be one of the important events in recent days because the 16th Finance Commission will be going to complete the meetings and prepare the reports next year.

“States have different opinions about the important issues. This is very important for the health of fiscal federalism,” he added.

Notably, the 16th Finance Commission was constituted by the President on 31st December 2023 with Arvind Panagariya as Chairman. The commission has already started consultations and discussions to get the feed and to discuss the memorandum of the states. The chairman and members are visiting the states, and the commission will be visiting Kerala in the month of December.

The Finance Commission has been constituted to make recommendations covering a period of five years commencing on April 1, 2026. Additionally, the commission is also mandated to review the present arrangements for financing disaster Management initiatives, with reference to the funds constituted under the Disaster Management Act, 2005 (53 of 2005), and make appropriate recommendations thereon.

According to the 15th Finance Commission’s recommendations, the centre should allocate 41 per cent of tax collection to states. This is known as vertical devolution.

The distribution among states, or horizontal devolution, is based on several criteria like demographic performance, income, population, area, forest and ecology, tax, and measures to check fiscal deficits by individual states.