Explain the financial ties that exist between India’s Center and States. (125 Words) [UPPSC 2021]
TeamSupreme
Resources & Suggestions
Mains Answer Writing Latest Articles
On: February 22, 2025
Comments:
0
Indo-US Relation: Areas of Cooperation & Conflicts
Key Areas: Defense, technology, trade, energy, and regional cooperation. Key Areas of Cooperation 1. Defense and Security Transition from buyer-seller to co-production and technology sharing. India as a Major Defense Partner (MDP) and inclusion in STA-1. Access to advanced technologies, ...
On: February 22, 2025
Comments:
0
भारत-अमेरिका संबंध: सहयोग और संघर्ष के क्षेत्र
मुख्य विषय: भारत-अमेरिका संबंधों की मजबूती, विशेषकर रक्षा, प्रौद्योगिकी और क्षेत्रीय सहयोग में प्रगति। सहयोग के प्रमुख क्षेत्र 1. रक्षा एवं सुरक्षा सहयोग भारत और अमेरिका के बीच रक्षा संबंधों का विस्तार। प्रमुख रक्षा साझेदार (MDP) का दर्जा और STA-1 ...
On: February 22, 2025
Comments:
0
India’s Disaster Management
The article discusses the growing tensions between the Centre and states regarding disaster relief funding in India. It emphasizes the need for a transparent and equitable disaster management framework. Key Disaster Threats India Faces Increasing Frequency of Extreme Weather Events ...
Financial Relations Between the Centre and States in India
**1. Revenue Sharing: The Central Government and State Governments share revenue primarily through tax distribution. The Finance Commission is responsible for recommending the distribution of central taxes to states. For instance, the 15th Finance Commission recommended a 41% share of central taxes for states for the 2021-26 period.
**2. Grants-in-Aid: States receive grants-in-aid from the Centre to support specific projects or to meet revenue deficits. For example, the Swachh Bharat Mission provided grants to states for sanitation projects.
**3. Borrowing Powers: States can borrow funds, subject to Central Government approval. The Fiscal Responsibility and Budget Management (FRBM) Act governs these borrowings. The 2020 COVID-19 pandemic led to increased borrowing limits for states to manage the economic impact.
**4. Financial Devolution: The State Finance Commissions are set up to recommend the distribution of local body finances, ensuring decentralized financial governance.
Conclusion: The financial relationship between the Centre and states involves revenue sharing, grants, borrowing powers, and devolution of funds, aiming to ensure balanced regional development and effective governance.