Finance Commission to Consider Freebie Schemes: Panagariya

Jaipur, Aug 1 (PTI) The 16th Finance Commission in its report will consider the freebie schemes run by the states and the Centre meant to provide individual benefits as these have a deep impact on finances, Chairman Arvind Panagariya said on Thursday.

He said that in this view the commission also has to see that macroeconomic and financial stability is maintained in the country so it will consider the issue in its report.

"The schemes that provide individual benefits that are given by the state and perhaps by the Centre also, have a deep impact on the finances.

"Keeping it in view the commission also has to see that macroeconomic and financial stability is maintained in the country. This comes within our mandate," Panagariya told reporters here.

He further said, "So, the Finance Commission will definitely consider it. Whether we will be able to say something on it or not and what we will say, it will take time. It may take six-seven months."

After the formation of the 16th Finance Commission in the country, the commission is assessing the financial condition of the states. After holding discussions with the states and the central government, the commission will give its recommendations.

Earlier, the Commission members held talks Chief Minister Bhajanlal Sharma, Deputy Chief Minister Diya Kumari, Deputy CM Premchand Bairwa along with other officials of the state government.

After the meeting, Panagariya said, "The state government has demanded 50 per cent share in taxes from the Centre instead of present 41 per cent share."

He said that the government also demanded a change in the standards of sharing between the states in view of the state's geography, area and special circumstances.

The Chairman said that in a presentation it was highlighted that Rajasthan is the largest state in the country in terms of area and two-thirds area of the state is desert. Around 21 per cent of the country's wasteland is in Rajasthan and there is about 1071 km of international border here.

The state government said that due to low population density in the state, more expenditure is incurred on infrastructure to provide basic facilities to the people.
Around 75 per cent of the population of Rajasthan lives in villages.
At the same time, the population of SC-ST here is also 31 per cent and water shortage is a big problem in the state.

On the demand for special state status for Rajasthan, Panagariya said, "Nothing can be said about it right now. We have visited four states right now. We have to visit 24 more states. Only after that, something can be said about it.