A Study of Intergovernmental Fiscal Transfers in India and Pakistan (TTI)
In both India and Pakistan, recent policy changes in the fiscal transfer system (the system that transfers financial resources from one level of government to another) have altered the relationship between the national level and the provincial or state level. This study will analyze the impact of these changes. The study will explore the systematic differences in intergovernmental fiscal transfer systems in the two countries and test a series of hypotheses to assess the impact of such changes on fiscal behavior at the sub-national level. The study will also investigate the impact on effective and equitable delivery of public services at the provincial and state levels. Finally, using disaggregated household level data, the study will test a series of hypotheses on the impact of changes in intergovernmental fiscal transfers on gender equity at the state or the provincial level. The objective is to offer policy recommendations to government to make the financial transfer systems in each country more effective and equitable. This study is funded through the Think Tank Initiative (TTI), a multi-funder program dedicated to strengthening independent policy research institutions, or think tanks, in developing countries. The program aims to enhance their ability to provide sound research that informs and influences policy. This second TTI phase (2014-2019) will fund 43 institutions, helping them consolidate their role as credible development actors in their countries, and, in some cases, regionally and internationally.
Project ID
108084
Project Status
Completed
End Date
Duration
18 months
IDRC Officer
Seema Bhatia-Panthaki
Total Funding
CA$ 231,405.00
Location
India
Pakistan
Programs
Think Tank Initiative
Think Tank Initiative
Institution Country
Pakistan
Project Leader
Asif Iqbal
Institution
Social Policy and Development Centre
Institution Website
Institution Country
India
Project Leader
Pinaki Chakraborty
Institution
National Institute of Public Finance and Policy
Institution Website
Outputs
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Emerging issues in state finances post-fourteenth finance commission : analysis of state budgets 2016-17 Brief
Intergovernmental fiscal relations in India changed considerably following the implementation of the Fourteenth Finance Commission’s (FFC) recommendations and subsequent restructuring of grants by the Indian federal Union Government. The analysis for the policy brief quantifies the effect of enhanced devolution recommended by FFC, and grants’ restructuring by the Union Government on states’ fiscal space. It also examines the implications of these policy changes on expenditures of states, especially social sector expenditures. Author(s): Gupta, Manish, Chakraborty, Pinaki Language: English |
Analysis of state budgets 2017-18 : emerging issues Brief
While India’s Union Government finances show a degree of consolidation, the finances of State Governments show signs of increasing fiscal imbalance reflected in levels of both revenue and fiscal deficits in a large number of States. This brief summarizes financial studies and fiscal analysis of state budgets and spending in India. State-wise analyses reveal that, while all States benefitted from the increase in tax devolution in 2015-16 (as compared to 2014-15), many experienced a reduction in central grants. The brief includes detailed analysis of the Ujwal DISCOM Assurance Yojana (UDAY) energy/power program and its impact on sub-national public finances. Author(s): Chakraborty, Pinaki, Gupta, Manish, Chakraborty, Lekha, Kaur, Amandeep Language: English |
Emerging issues in state finances post-fourteenth finance commission : state level debt-deficit dynamics - emerging issues Brief
The Fourteenth Finance Commission (FFC) prescribes the conditions for enhanced borrowing limits of States in India. FFC debt-deficit dynamics can be analyzed in two ways: ex-ante and ex-post. The analysis of outstanding debt and deficits of all States ex-post to FFC period in the first year of assessment (2015-16) revealed that only five States – Jharkhand, Karnataka, Madhya Pradesh, Odisha and Sikkim, have successfully managed the Fiscal Responsibility Act (FRA) thresholds of deficits. Fiscal consolidation at the state level under the new framework of borrowing proposed by FFC should focus on quality of expenditure and elimination of revenue deficit. Author(s): Chakraborty, Lekha, Gupta, Manish, Chakraborty, Pinaki Language: English |
Would UDAY brighten up Rajasthan finances? Paper
The paper analyzes the aggregate picture of the finances of Rajasthan, taking the power sector into consideration: Ujjwal DISCOM Assurance Yojana (UDAY) is the financial turnaround and revival package for electricity distribution companies of India (DISCOMs) initiated by the Government of India. Rajasthan accounts for 5.66 per cent of the total population of the country, with a low per capita income. It has made significant progress in social sector development and reduced the level of poverty in recent decades. Although the State has managed its fiscal deficit well, power sector finances continue to be a significant drag on its fiscal resources. Author(s): Chakraborty, Pianki, Gupta, Manish, Chakraborty, Lekha, Kaur, Amandeep Language: English |