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Rs 8146 Cr for state
Published on 27 Feb. 2010 1:28 AM IST
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As per the recommendation of the Thirteenth Finance Commission, of the Rs 51,800 crore projected to go as non-plan revenue grants over the next five years, Nagaland pocketed Rs 8146 crore, There is also a Rs 1,500-crore incentive for Assam, Sikkim and Uttarakhand, which will get two-thirds of the fund. In contrast, Himachal Pradesh, Uttarakhand, Jammu and Kashmir, Tripura and Jharkhand are the bigger losers in terms of the share of total transfer for the five-year period starting April 2010. In terms of the share of total taxes, the hilly states led by Himachal Pradesh will see the maximum gain, followed by Manipur, Tripura and Nagaland. The state-specific grants can be used for purposes as diverse as provision of drinking water facilities, preservation of historical monuments, construction of prisons and police training. While the tax devolution formula has assigned 35 per cent weight to area and population, factoring in the higher administrative cost, there is an incentive for those who have fared better on improving their fiscal position. In addition, 47.5 per cent weight had been assigned to fiscal capacity distance. Based on the projections for the next five years, the total transfer to the states in the form of devolution and grants-in-aid will more than double to over Rs 17 lakh crore with the most rapid increase expected in the case of Arunachal Pradesh. Compared with the Twelfth Finance Commission, there is an increase in the ratio of devolution to GSDP as projected by the Thirteenth Finance Commission.

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