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Meeting Of All Political / Academic / Professional Organisations Of Bihar For Preparation Of Joint Memorandum To The 14th Finance Commission


From 16-11-2013 To 16-11-2013
Political parties demand Rs 4 lakh crore for Bihar 

Patna: A meeting of all political parties and academic/professional organisations in Bihar was organized at ADRI on Saturday.

The meeting had been convened to discuss issues pertaining to the ‘Joint Memorandum' that has to be submitted to the 14th Finance Commission of India by ADRI. The Joint Memoranda for the 12th and 13th Finance Commissions too had been prepared by the experts at ADRI.



Presenting the suggestions of his party, Dr Sushil Kumar Modi of the BJP said the income from Non-Tax Receipts (like the money accruing from the sale of spectrums etc.) and cess/surcharges be also brought into the devolution net by Centre, upon the recommendations of the 14th Finance Commission. He said there should also be a provision for a separate 4 per cent share of the Central taxes to be dedicated towards the cause of urban and local bodies and PRIs. He stressed on the need to have a moratorium on the amount of loan interest that is an increasing burden on the state. Further, to offload the burden on the state after the 7th Pay Commission recommendations get implemented in the next 2-3 years, Bihar needs to shape its demand from now only. Also, malnutrition and rapid urbanization need a special attention, said the previous Finance Minister of Bihar. Legislation-based Central schemes increase another set of burden on states. Centre must share this load on states, substantially. Modi said in total Rs 4 lakh crore will be required to be allocated to Bihar by the 14th FC.

Representing his party JD (U) at the meeting, Shri Vijay Chaudhary, Water Resources Minister (Government of Bihar), said the objectives must be clearly set out while submitting the memorandum to the 14th FC. Underlining the fact that flood is a perennial problem for this state, Chaudhary said there should be a special focus on undoing the damages caused by floods in Bihar. Also, he emphasized that the practice of adopting 1971 as the base year must be done away with now as the 2011 markers are ready. Sushil Modi of the BJP was also of the same view. Chaudhary also emphasized the need for a better volume of allocation for the Power Sector in Bihar.



Shri Anil Sharma, Ex-President, BPCC, representing his party Indian National Congress said the Terms of Reference must be revised by the 14th FC if the state finds any deficiency in that.

Shri UN Mishra of the CPI suggested that the demands which the state is going to put before the 14th FC should be project-oriented, and not fund-oriented.   

Dr Ashok Kumar Sinha from the RJD suggested that the memorandum include the demand that flood be declared as a ‘permanent national calamity'.

All political parties agreed on the suggestions deliberated during the meeting. Shri Sarvoday Sharma from CPI (M), Dr Abhayanand Suman from Rashtriya Lok Samata Party (RLSP), and Manikant Pathak of SUCI (C) were amongst those present at the meeting.

Industry representatives included Satyajeet Singh, Chairman, PHDCCI, Arun Agrawal, President, BIA, PK Agrawal, President, Bihar Chamber of Commerce, Kamal Shahi, Director, ICC.  



At the start of the meeting, giving the details on what the Joint Memorandum would include, Professor PP Ghosh of ADRI said the memorandum, it is proposed, will contain broadly five chapters.

The first chapter will mention the background, detailing the overall regional inequalities prevailing in the country and the arrangements of fund transfers through the Finance and Planning Commissions over the years. Other sub-sections in the Chapter would deal with the provision of transfer of Taxes and Duties as well as grants-in-aid through the Finance Commission.

In Chapter II, the Terms of Reference (ToR) along with the Issues for the 14th Finance Commission in the perspective of backwardness of states will be dealt with brief comments on the ToR.

However, Chapter III would describe the present status of Bihar, including its backwardness and disadvantages.

While points for consideration of the 14th Finance Commission are proposed to be presented in Chapter IV, Chapter V may deal with the suggested criteria/weights to the advantage of Bihar.   



The 14th Finance Commission has been constituted under the chairmanship of former
RBI governor Dr YV Reddy. The Commission that will cover a five-year period from April 2015 to March 2020 has to make its report available to the Government of India by 31st October, 2014.

A Finance Commission is constituted every five years in accordance with the constitutional mandate with a view to recommend the distribution of the divisible pool of the financial resources of the Government of India between the Union and the States, as also the horizontal allocations across states.

In determining the horizontal devolution, the successive Finance Commissions broadly attempted to address the issues of fiscal needs, fiscal capacity, costs of providing similar level of public goods and services and rewarding efficiency in fiscal efforts and outcomes. Despite all these endeavours, the regional disparity in India is widening, with Bihar remaining the poorest among all.

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