41 pc divisive pool given to states in previous finance commission: Arvind Panagariya

Gangtok, Jan 20 Chairman of the 16th Financial Commission of India Arvind Panagariya on Monday said that as per the recommendations of the previous commission, 41 per cent divisive pool went to the states while 59 per cent went to the Centre.

The members of the 16th Finance Commission of India have been visiting Sikkim and they were in Gangtok on Monday.

Addressing media persons in Gangtok, Panagariya said, “As per the 15th Financial Commission, 41 per cent of the divisible pool has gone to the states while 59 per cent to the centre. Criteria such as states’ share in the national population, states’ share in national total area and income distance will affect where finances will be pooled from the 41 per cent.”

The Financial Commission is in the state to understand and segregate the “divisible pool” wherein the commission decides how much finance goes to the states and what percentage goes to the Centre.

The Chairman in his briefing stated that the Commission has been visiting several states, consulting with stakeholders, chairman of the past four commissions, experts, and ministers of states.

“Based on these consultation processes, a final report will be published in October 2025, which shall be submitted to the President of India,” Panagariya said adding that the work of the 16th Financial Commission will come into effect from 2026 to 2030.

The Commission met with the Chief Minister of Sikkim and state government functionaries, urban local bodies, rural local bodies, stakeholders, trade and industries, and representatives of political parties.

The chairman also outlined the jurisdiction and mandate of the Finance Commission which includes vertical devolution, local government grants, disaster relief, defence and security, fiscal consolidation etc.

Source: IANS