The Meghalaya government has sought Rs 1,14,745 crore as grants from the 16th Finance Commission over the five-year period.
A memorandum to this effect was submitted by Chief Minister Conrad Sangma to the Chairman of the 16th Finance Commission Arvind Panagariya here today.
The State government has projected Rs 43,251 crore for critical sectors, Rs 69,324 as pre-devolution gap, Rs 500 crore for State Public Sector Enterprises (SPSEs) and Rs 1,670 crore as grants to local bodies.
There are twelve critical sectors which the State government sought funding from the 16th Finance Commission.
For road connectivity, the government sought grants of Rs 14,750 crore, for power, it sought grants of Rs 6,207 crore while for water sector the amount requested was Rs 4,122 crore.
The other critical sectors for which grants were sought from the Finance Commission include urban development (Rs 4,820 crore), tourism (Rs 3,600 crore), education (Rs 1,940 crore), health and nutrition (Rs 1,880 crore), agriculture (Rs 1,652 crore), youth engagement (Rs 1,607 crore), improving the standard of administration (Rs 1,250 crore), forest and environment (Rs 923 crore) and private sector development (Rs 500 crore).
Meanwhile, the State government has requested for an increase of vertical devolution of taxes from the divisible pool from the current 41 per cent to 50 per cent.
On the horizontal devolution of taxes, the State pitched for a larger proportion to the State’s share to be devolved based on forest and ecology. The previous 15th Finance Commission had given a weight of 10 per cent. Today, the State proposed to raise it to 15 per cent.
“They also suggested on using a new criteria for the rural dispersion population of 2.5 per cent to 5 per cent weightage be given,” Panagariya told media persons.
He also said that the State government also suggested that the quality of expenditure should also be given some consideration with a weightage of 2.5 per cent.
Panagariya also said that Meghalaya depends heavily on central funding.
He also said that the debt to GDP ratio of the State is high as well as the fiscal deficit.
“Part of it is explained by the fact that this State has been making good use of the long term capital grants which have been given as a 50-year loan which is interest free. It is almost like a grant but it is not and therefore it has to be taken to the debt-to-GDP ratio” Panagariya said.
He also said that the goal of the Meghalaya government to have a 10 billion dollar economy by 2028 is achievable.
The 16th Finance Commission is expected to submit its recommendations by October 2025. Its recommendations will be valid for five years starting from April 1, 2026.
