Gangtok, 21st Jan: A high level meeting of the 14th Finance Commission with the Government of Sikkim was held today at Raj Bhawan. The 14th Finance Commission comprises of Dr. Y.V. Reddy, former Governor of Reserve Bank of India, as Chairman, Mr. A.N. Jha, IAS, as Member Secretary, and Professor Abhijit Sen, Member Planning Commission, Ms Sushmanath, former Union Finance Secretary, Dr. Govinda Rao, Director NIPFP, and Dr. Sudipto Munde, former acting Chairman Statistical Commission as members of the Commission.
The meeting had the presence of Chief Minister Mr Pawan Chamling and his Council of Ministers, Chief Secretary Smt R. Ongmu, Principal Secretary Finance Department Mr M.G. Kiran and senior officers from Finance Department, and all Departmental heads.
The Chief Minister in his speech, welcomed the 14th Finance Commission and highlighted the following points:
1. Share of Central taxes to the sates to be raised from 32% to 50% and a special dispensatrion for Sikkim
2. While considering the weightage for horizontal devolution, population od 2011 Census may be used
3. Need to consider measures to transfer all centrally sponsored schemes under state subjects with requisite funds and flexibility in the implementation of the schemes
4. Education and health are the priority sectors for the state government
5. Sikkim is the only state to allocate 20% of its financial annual allocation to the education sector, state has embarked on a scheme to enhance the employability of the local youth by establishing 43 livelihood schools
6. First state to provide free hepatitis B vaccination to children, Missipon Healthy Sikkim and CATCH programme beiong the lagship programmes m Government is conbstructing a 5575 bedded super speciality hospital
7. The Lonely planet. The largest travel guide in the worlds has ranked Sikkim as the number one region to visit in 2014
8. Promotion of Village tourism, rural tourism and homestay as a means to diversify livelihood options and make tourism sector more village oriented people centric as wella s eco friendly
9. Creation of Smriti Bans, biodiversity parks, butterfly parks and herbal gardens,
10. 50% reservation of seats for women at the Local Body level
11. The policy to devolve 70% of the annual outlay for rural development remains the cornerstonbe of the State development agenda.
(Please find attached herewith complete address of Hon’ble Chief Minister of Sikkim)
14th Finance Commission meeting
Raj Bhawan
January 21, 2014
Speech delivered by Hon’ble Chief Minister
On behalf of the State Government and the people of Sikkim, I extend a very warm welcome to the Hon’ble Chairman, Dr. Y. V. Reddy, distinguished Members and officials of the Commission. As we enter into the last lap of the 13th Finance Commission mandate, I recall with pride the excellent period of interaction, coordination and working environment with the outgoing Chairman and his distinguished Members and professionals. With their support, we were able to design some of the most innovative and ambitious development programs in the State in the socio-economic spheres. In spite of all the inherent development bottlenecks and difficulties we face as a Himalayan border State, we have emerged as one of the most progressive and forward looking States in the Country.
However, some concerns we had expressed during the last period with the Commission still linger on. And we believe that as infrastructure-deficit State surrounded by three international borders, with limited resource mobilization options, Sikkim deserves special consideration and fondly hope that a new yardstick to infuse new growth dynamism is adopted. The nationally evolved criteria and resource sharing formula tend to undermine the very bedrock of our people’s hopes and aspiration for growth and development in the State. This calls for a differential approach to address special needs and requirement of states like Sikkim as compared to resource-rich States, geographically more conducive and favourable to speedy growth with wider development options.
And at this backdrop, I am confident that Dr. Reddy, the Hon’ble Chairman and his team would build up our confidence through special consideration and focused devolution to propel our development. With your vast knowledge and wisdom, I rest assure that Sikkim will receive a new beginning in terms of sharing and transfer of resources between the Centre and the State and an accelerated growth and development as a whole.
At the outset, I would like to emphasize on Sikkim’s entry into the mainstream with the Country in 1975. The first initial years after merger were fruitlessly utilized. Development in real sense started with the democratization of our governance only in the early 1990s. This also means, we missed out on many related opportunities, building of our economics and fiscal consolidation measures that otherwise were available and accessible to others in the Country. We had to start from the bottom faced, as we were, with daunting challenges to address wide deficit in socio-economic condition of our people.
Sikkim, through the decades, has pulled major breakthroughs in all sectors with our hardwork. The range of development strategies we have adopted during the last nineteen years have been tailored to meet the special needs of the people of Sikkim, their hopes and aspirations. As a landlocked Himalayan State with three international borders on three sides, we face severest constraint in terms of access to available development instruments and utilizing development potential to our fullest.
Education and health are our priority sectors and facilities available under these sectors are virtually free in Sikkim. We are perhaps the only State to have earmarked over 20 percent of our annual allocation in the education sector.
Sikkim has recorded an impressive improvement in the literacy rate from 56 percent in 1993-94 to 82.2 percent today. The teacher pupil ratio of 1:13 is perhaps one of the best found in the country.
The new Central University has now come up in the State. Because of our consistent efforts, the Gross Enrolment Ratio at Higher Education level has increased to 24.8% against the national average of 15%.
The innovative Chief Minister’s Meritorious Scholarship Scheme for rural children to study in public schools, Chief Minister’s Special Merit Scholarship, Prerna Yojana, small family scheme that is linked to academic excellence among girl students, have helped many of our promising children from weak economic background to excel at the regional, national and international levels.
This past year, we also started another unique programme to sponsor Sikkimese educated youths for coaching in civil services and defence service in select coaching centres across the Country. We also depute our civil service officials and technocrats in reputed training institutes abroad for training.
We started the Skill Development and Capacity Building programme in the State in 2003. Directorate of Capacity Building and the State Institute of Capacity Building are fully functional and various training programmes are being successfully held round the year with placement figures exceeding over 70% in the hospitality sector alone.
Establishment of 43 Livelihood Schools across the State has added a new dimension in the training of the local youth. These schools train local youth in trade and profession ranging from carpentry to basic engineering.
Over the decades, we have worked out comprehensive strategy for a healthy Sikkim. Sikkim was perhaps the first State in the Country to provide free Hepatitis B vaccination to children. Infant Mortality Rate (IMR) of 24 per 1000 is better than the national average. The life expectancy ratio in the State has increased by over 2 years on average when compared to 1994.
Launched in 2010, the Chief Minister’s Comprehensive Annual and Total Check-Up for healthy Sikkim (CATCH) program has been designed to provide routine check-up, preventive and remedial measures on compulsory basis annually. Most of our people who were not aware of silent killer diseases like Diabetes, Hypertension, oral pre-cancerous lesion and other diseases are now being detected in early stages. People are found to come for follow-up more frequently for medical reviews and check-ups in PHCs, District Hospitals and STNM Hospital. Mission Healthy Sikkim and CATCH programs are the flagship programs of the State Government.
The on-going construction of 575-bedded multi-specialty hospital at Gangtok is to facilitate people with super class medical facilities.
Sikkim with its natural beauty, the flora and fauna inhabited by friendly and hospitable people has emerged as premiere eco-tourism destination in the Country. Our long term goal is to promote tourism as the new profession of the 21st century. The tourism industry shall have multiple effect by way of employment generation, revenue generation and other cascading effects across sectors to benefit all our people including young entrepreneurs and the farming community. The Lonely Planet, the largest travel Guide in the world has ranked Sikkim the Number One region to visit in 2014 beating other popular destinations in other Continents. This comes as a shot in our arms.
We have built and completed some extraordinary projects to promote pilgrimage tourism in the State. We conceptualized locating all four char dhamas in one composite place. This centre has emerged as the central point to promote pilgrimage tourism in Sikkim. The recently consecrated Buddha Park at Rabongla will be another secular contribution from Sikkim to the Country in its quest for completing the Buddhist Pilgrimage Tourism Circuit. We are promoting village tourism, rural tourism, homestay as a means to diversify livelihood option and make tourism sector more village-oriented and people-centric.
In the field of environment conservation, Sikkim has created a new benchmark. We have created a number of smriti bans, biodiversity parks, butterfly parks, herbal gardens. We have launched Green Mission and Ten Minutes to Earth programs. We have imposed prohibition on large number of human activities to conserve our greenery, to protect and promote animal life and the many species of floral wealth found in Sikkim. In totality, the effect has been very encouraging as our forest cover has increased from 43.95 % in 1993-94 to 47.31%, an increase by over 3 percent. Sikkim is the only State to have increased its forest cover in the past two decades re-validating its fame as the greenest state in the country. The State has also got recognition from UNDP listing its Dhara Vikas program as the model of conservation efforts addressing threat of Climate Change.
Sikkim has the distinct identity of maintaining gender equity and percentage of women workforce in many areas are more than the male counterpart. As equal partners, they are contributing handsomely towards development of State. We created a landmark 50% reservation of seats for women at the Gram Panchayat, Zilla Panchayat level including urban local bodies. As a result, our women are occupying post of Adhyakshya and Upa-Adhayakshya in districts under the reservation policy. People’s policies of the Government are our hallmark.
The policy to devolve 70% of the annual outlay for rural development remains the cornerstone of our development agenda. Based on this decision, the Government of Sikkim has ensured that development initiatives are evenly distributed and evenly spread to fulfill goal of inclusive growth and development.
Connectivity has been our recurring problem and the hilly terrain is highly vulnerable to natural calamity. The terrible earthquake which struck the State on September 18, 2011 is still fresh and vivid in our memory when valuable lives and properties were lost, severely jolting our development tempo. The people of Sikkim have slowly limped back to normalcy. The resilience of the people of Sikkim has been our greatest strength as now we are constructing 7,972 REDRH (Re-construction of Earthquake-damaged Rural Houses) and 6,000 CMRH Houses in the State which will be totally completed by 2014. The fear of being in the critical seismic zone will, however, remain with us always.
We have adopted policy of organic farming in our farmland to supplement our economy with high value produce. We are moving ahead with a mission mode to completely transform Sikkim into organic zone. We are applying this concept in our agricultural activities, horticulture, floriculture and in animal husbandry sector. We hope to be fully organic next year.
I am happy to inform that the State has been bestowed with the prestigious Agriculture Leadership Award 2013 for being the “foremost democratic model in the country on organic farming”. Recently, we have also secured the commitment of Union Ministry for establishment of Horticulture College, Cold Chain System and Mega Food Park in Sikkim which will further boost our organic effort.
In matters relating to Panchayati Raj Institutions, our State has introduced major initiatives since 1997 to fully decentralize financial and administrative machineries including decision making powers to the grass root functionaries. Therefore, under a more decentralized regime, we have achieved a bottoms-up approach to development where priorities are defined at the village level and implementation rests with the villagers. As a result, Sikkim State has been ranked among the top three states in the Country in terms of implementation of flagships programs including MG-NREGA. Even in Panchayati Raj administration, we are among the first three best in the Country.
The State Government has undertaken some specific measures to firm up our revenue base by legalizing on-line gaming including state lotteries, levy of surcharges and green cess, sale of surplus power generated by the hydel projects being commissioned and imposition of entry fee for tourists visiting restricted areas.
Depending on the genuine local developmental needs, the State may be allowed to access 50% share of the overall Centre-State market borrowing pool as was prevalent in the State. Apart from the States being given access to market borrowings, they should also be given the option to issue tax-free bonds in order to mobilize resources for catering to need-based developmental priorities.
Given the constitutional responsibilities and the development priorities of the State and the limitations of constitutional powers in matters of resource mobilization combined with inadequate Central transfer, I would like to urge upon the Commission to kindly consider, in all fairness, to enhance the share of the gross Central taxes to States to the level of 50% from the present level of 32% duly considering inclusion of all Central surcharges and cess in the divisible pool.
I would like to draw the attention of the Commission on the issue relating to the enormous impact of the Sixth Central Pay Commission which resulted in a severe financial crunch for the State. With the announcement for constitution of the Seventh Pay Commission by Government of India, the issue relating to impact of its implementation in the State is being left outside the purview of the terms of reference of the Commission. I would like to urge upon the Commission to extend 100% support on this account in respect of the North Eastern and special category States.
I also place before the Commission that the manner in which Centrally Sponsored Schemes have been imposed upon the States have eroded the decision making powers and autonomy of the States. Further, these Centrally Sponsored Schemes involve substantial contribution of the State resources in the sharing expenditure. It is also observed that considerable funds under the Centrally Sponsored Schemes are being routed to the Districts and other non-Governmental agencies directly from the Central Sponsoring Ministries by-passing the authorities of the State Government.
I would like to urge upon the Commission to address these anomalies and consider measures to transfer all Centrally Sponsored Schemes under State subjects duly supported with requisite funds and also provided with federal flexibility in the implementation of the schemes.
The element of debt constitutes a major burden on the fiscal health of the States. Despite submissions made by the State to the Centre and the XIIIth Finance Commission for a substantive debt-relief package, it is unfortunate that the recommendations of the XIIIth Finance Commission with regard to Central loans to the States did not include loans from 1999-2000 onwards which constitutes a major share of Central loans in respect of our State. Besides this, the debt relief package as recommended by the Commission also excluded from its purview the Central loans under Finance Ministry. Considering the seriousness of this matter, I earnestly request the Commission to kindly take a comprehensive review with regard to the debt problems of the State and to consider suitable debt-relief measures such as reduction in the interest rates on loan component as also waiving off a part of the debt.
The Commission may also kindly note in this context that with most States defaulting in complying with the conditionalities stipulated by the XIIIth Finance Commission, the incentive fund under this dispensation remained substantively un-disbursed, I request the commission to kindly consider releasing these withheld funds to the States concerned.
While determining the quantum of grants-in-aid to the States, the Commission may kindly give due consideration to the disadvantages of the Special Category States and the North Eastern States in particular. Considering of deficit grants and special allocations under the Award of the Commission should accord due weightage to the region’s specific problems of States such as recurring landslides, drought situation, border area problems, earthquakes, needs for power subsidy, food subsidy, etc. without any conditionalities attached.
Given the strategic location of our State sharing three international borders, there is an urgent need to address several issues relating to poor infrastructure, roads and other concerns like environmental security and water security with larger ramification. Speedy completion of Greenfield Airport in Sikkim, rail project as well as extension and upgradation of the National Highway 31A need urgent attention. Construction of an Alternative Highway to link Sikkim with the Nation need utmost attention. These difficulties and inherent disadvantages tend to derail our development tempo leading to untold hardship among our people. Spiraling inflation in every sphere of economic activity mainly due to transportation costs aggravated by the recent increase in the petroleum prices directly impact the lives of common people.
Sikkim with limited resource is today a happening State largely due to our own dogged commitment. Support from the Central Government needs to be further strengthened. From our own point of view, Sikkim with its own geography and limitation need certain enabling framework to fully access a number of incentives across board without any conditions. As usual, we are moving forward to take Sikkim to the next phase of development. And in fact, with all development parameters well spelt out, we are moving ahead to infuse complete quality in all our public services.
We have evolved time bound targets to reap rich harvest from our efforts under hydro-power generation, floriculture, horticulture, eco-tourism and agro-based organic units. Accordingly, we have set aggressive development targets in the State in the form of twenty two Mission Statements involving all sectors and areas of human security.
You will appreciate that the comprehensive set of Mission documents have been evolved through large-scale consultation, research work and seminar spread over the last nineteen years. We have already achieved many milestones in furthering the missions. Nonetheless, we need to be consistent with our work and commitment and would request the Commission for an all-abounding support and assistance to develop Sikkim to its fullest potential.
Before I conclude, I would briefly touch upon general difficulties we face as a constituent State and would urge upon this august Commission to recommend to all concerned Ministries and authorities accordingly, so that federal structure which is the soul of democratic tradition is further cemented and strengthened.
(i) The State’s share of taxes in the overall divisible pool is just 32 %. There is adequate reason for enhancement considering the multifarious expansion in the administrative functions and responsibilities of the States. This is a matter that deserves attention of the Commission for a fair and a rational review.
(ii) The provision of grants as a gap filling measure under Article 275 (i) is counter-productive in as much as this approach would encourage the backward States to continue following a retarded growth trend while depending on being cross-subsidized by the better performing States. There is an imperative need to make a clear distinction between the fiscally imprudent States and those which are fiscally disadvantaged under this dispensation.
(iii) The stipulation provided in the terms of reference for the Commission regarding adoption of the population figures of 1971 Census as the factor for devolution of taxes, duties needs to be reviewed. This point of reservation was also expressed to the previous Finance Commissions and we reiterate the argument put forth that under Article 275 of the Construction, it is clear that grants are to be extended to States which are in need of assistance and that such assistance cannot be determined with reference to the population figures preceding a period of more than four decades but must be based on the population figures for the period for which the grant is being considered.
We urge upon the Commission to appreciate the points re-iterated time and again and give due weightage to the financial needs of the State as also the historical circumstances prevailing at the time of the political transition in the context of Sikkim State.
(iv) The 13th Finance Commission had been pleased to sanction a sum of Rs. 200 crores for construction of Skywalk at Bhaleydhunga as centre of attraction and landmark in development of tourism. We are thankful for the grant and further request this Commission to sanction an additional Rs. 400 crores to complete this unique signature tourism project.
It has always remained a great experience to share our vision of a developed India through our mutual efforts. And development of State would finally bring about progress to make Country stronger. I would, therefore, request this Commission to appreciate the progress been made by the State in various spheres of development. However, there is a dire need for considering substantial support in bringing the developmental gaps including in basic infrastructure and institution building.
Confident of your full-time support in the progress and development of Sikkim, I assure you of our utmost cooperation in matter of mutual concern at all times
Thanking You
JAI HIND!
On behalf of the Government of Sikkim, Chief Secretary made a detailed presentation on the State Finances and its projections for the five-year period starting 1st April, 2015. Before the start of the meeting, a detailed memorandum on this regard was submitted to the Commission by the Government of Sikkim.
Following are the highlights of the presentation of the Chief Secretary:
· On the issue of the current practice of considering 1971 population as a factor for devolution, the Chief Secretary proposed that 2011 census may be adopted for the purpose of devolution of Central taxes and Grants-in-aid, citing the key reason that Sikkim was not a part of the Indian Union at that time
¡ On the issue of Devolution of Union Taxes and Duties, she proposed that vertical transfers be raised to enable the fiscally disadvantaged States ones to improve public services and attain higher growth rate; and share of net proceeds of Central Taxes be raised from 32 % to 50 %
¡ On horizontal transfers, Proceeds from surcharge/cess on income tax be included in the divisible pool, and population figures of the latest census be considered
¡ On Criteria for tax devolution, she stressed on Investment in human resource development-Indicators showing progress in achieving education and health indicators be considered
¡ On Fiscal discipline she stated that Improvement in ratio of own revenue receipts to its total revenue expenditure should include prudent fiscal management resulting in rising revenue surplus and containing fiscal deficit and debt
¡ On Cost disabilities ,Remoteness, high transportation cost of goods, large proportion of forest area and difficult terrain, which increase unit cost of providing public service should be included
¡ On Goods and Services Tax, following proposals were laid down:
1. Introduction of GST would help in reforms in indirect taxation system integrating taxes on goods and services
2. Recommendations of the 14th FC on the impact of GST on State finances and the mechanism for compensation will be important inputs in this regard.
3. GST will throw new challenges for which the tax administration needs to be upgraded. States like Sikkim with limited resources need financial support for this
4. Supports the demand of the Empowered Committee that the full compensation should be provided for five years after implementation of GST through the GST Council
5. States should legislate their own GST laws based on the model prepared by the Empowered Committee
6. Though optimistic about the introducing GST; there are certain areas of concern
7. Does not favour inclusion of petroleum products under GST
8. Against the demands by some States to Levy of tax to compensate GST loss
9. Collecting taxes for the local bodies and such taxes should not be subsumed in the GST
10. Amusement and Betting tax, Electricity duty, Tobacco and Tobacco products, liquor and Stamp Duty should also be excluded from the purview of GST
11. State Governments be empowered to levy cess and surcharges and such levies being State matters may be kept outside the purview of GST.
12. Health and Education are primary services may also be kept outside the purview of GST
13. Calculation of the RNR (Revenue Neutral Rate) of many States may not be accurate. To assure the States that their fiscal growth will not be hampered due to revenue losses, the Government of India may provide 100% compensation on this account
¡ Regarding Grants-in Aid, the Chief Secretary laid down the following points:
1. Main objective of giving grants to the States in need is to establish a level playing field among all the States
2. While the 12th FC recommended a NPRD grant of Rs.188.47 crore, the 13th FC assessed surplus position in non-plan revenue account for which no NPRD grant was recommended to the State
3. State is hopeful that the 14th FC would take a liberal view on grants while considering the expenditure needs of the State and its limited ability to raise resources from a very small and inelastic source
4. State Government is also hopeful that its record of prudent fiscal management would be rewarded by the Commission
5. State projection of deficit in non-plan revenue account be considered while determining the grants
6. State faces problem in utilization of project specific grants due to natural calamities and climate problems in hilly areas and environment clearance for acquiring land for the projects
7. Grants to flow to the States in an uninterrupted manner like share of Central Taxes without any conditionality
8. 13th FC recommended grants for the maintenance of Capital assets like Roads and Bridges. The State urges the 14th FC to include maintenance of building as well under the maintenance grants.
9. Commission to consider the up-gradation demands of the State favourably
¡ On Ecology and Environment, the Chief Secretary made the following proposals:
1. 14th FC urged to support the State in two key areas - forest management and proper glacier dynamics studies
2. Forest Management activities for which grant is needed for Preservation and Propagation of Unique Floral and Faunal Diversity of Sikkim, Regeneration of Degraded areas, Production of Quality Plantation Material, Forest Protection, Promotion of Ecotourism in Forests, National Parks, and Sanctuaries, Adapting Forest Management to Emerging Threats of Climate Change
Cost Estimates: The activities proposed for forest management in the above sections are estimated to cost about Rs. 74 crores
¡ On Study of Glacier Dynamics
1. Considering large number of glaciers in Sikkim, it is very important to study them in a scientific manner
2. Sikkim State Council of Science and Technology in support of DST, GOI has been studying the glacier dynamics
3. Need of Permanent Manpower in the Glacier Studies and training of work force
4. Needs to be supported to get skilled manpower trained in glaciological programmes in India
5. Activity for the first five years is estimated to cost Rs.10 crores that includes cost of recruiting trained scientists in glacial studies
¡ Considering the fragile ecosystem of the State and frequent natural calamities, the Chief Secretary laid down the following points on Financing Disaster Relief Expenditure
1. Prone to natural calamities as it is situated at very high altitude and has fragile ecology
2. Entire state is categorized as a highly active seismic zone and experiences frequent earthquake
3. Frequent landslides in the monsoon season due to hilly topography
4. While the Disaster Management Act widened the definition of disaster, the 13th FC held the view that the existing list of natural calamities is exhaustive
5. FCs have not considered the aspects of prevention of threat of any disaster, mitigation of risk and capacity building for disaster management
State’s Submission on the above subject:
- Norms of expenditure of CRF (SDRF) that allows only temporary restoration works should change to incorporate works of semi-permanent nature with use of concrete
- Existing guidelines do not permit prevention/mitigation works. In hilly terrain like Sikkim, preventive measures are the best solution for avoiding greater calamity
- Definition of Natural Calamity be widened to accommodate:
¡ Deaths and damages to the houses due to lightening
¡ Epidemics such as bird flu caused during the monsoon
¡ Loss of life and property due to forest fire
- Given its proneness to earthquake, earthquake preventive and mitigation measures be included in SDRF
- 100% funding by the Centre for all Special Category States like Sikkim
¡ Suggested Approach for the 14th FC – RURAL LOCAL BODIES
1. Capacity of PRIs to generate own resources for carrying out the responsibilities assigned to them is weak and grossly inadequate
2. Adequate finances be available with the PRIs to match the transferred functions based on the activity mapping for the devolution of funds, functions and functionaries (3Fs).
3. State’s ability to meet the resource requirements of the PRIs based on the recommendations of SFC is not adequate as
4. State is constrained by its committed liabilities which are a priority
5. Eligibility conditions for the entitlement of grants and fines for delay in transferring grants to PRIs not be imposed due to Sikkim’s vulnerability to occurrence of frequent landslides, difficult terrain, inadequate communication infrastructure, etc
6. Taking into consideration the above issues, the 14th FC is urged that the volume of local body grants be substantially increased
Suggested Approach for the 14th FC – URBAN LOCAL BODIES
1. Urban Local Bodies formed in 2010-11 are still in their early stages and require funds for carrying out functions and responsibilities entrusted to them
2. Grant for ULBs by the 13th FC was negligible
3. The 14th FC to consider above issues while deciding on the quantum of grants ULBs
Thereafter, The Chief Secretary submitted broad issues of the state for consideration by the Commission:
1. Sikkim should not be treated ‘at par’ with other States in the Indian Union. Normative approach should not underestimate the special problem of the State
2. 14th FC urged to pay heed to the State’s demand for grants to build infrastructure to tap its inherent potentialities
3. Assessment of the State Finances should not omit genuine expenditures. Net deficit of Transport sector be included for accurate assessment
4. Sikkim should be supported to protect the Himalayan ecology and forest cover
5. No Stringent conditions to utilize the grants to enable utilising the funds earmarked for developmental activities
6. Commission to consider the difficult situation in Sikkim and not press for insulating the pricing of public utilities based on commercial principles
7. Quantitative fiscal deficit targets be expanded to provide adequate funds for maintenance expenditure and expand the capital expenditure to create infrastructure
8. Commission should relook at the strict fiscal deficit target while suggesting any fiscal restructuring framework
9. Technical assistance be provided for comprehensive up-gradation of public expenditure management system
10. Committed liability of completed plan schemes be included in the Assessment
11. Commission to consider plan schemes up to March 31 2017 to assess the requirements for maintenance expenditure
12. 100% funding by GOI under CRF be considered
13. Consider 100% Liability on account of pay revision of the Govt. Employees in line with the 7th Central Pay Commission
14. Certain percentage of enlarged pool may be earmarked for the Special Category, resource starved and hilly states with difficult terrain and sparse population
15. Cost disability may be taken as a factor for consideration as our State having no rail or Air link facility deserves special consideration
16. The State urges the Commission to provide liberal grants for local bodies to help realizing the State goals under the ‘Gram Swaraj Yojana’
17. To consider the latest population instead of 1971 population as a factor in the devolution formula
18. 14th FC to consider the fiscal performance of the State while determining the grants
¡ In the end, the Chief Secretary made the submission for the consideration of following grants by the 14th Finance Commission:
1. Local Body grants – 336.95 Cr
2. Forest Maintenance Grant – 74 Cr
3. Glacier Dynamic Studies – 10 Cr
4. State Specific Needs – 2136.03 Cr
5. Pre Devolution Non Plan Revenue Deficit Grant – 17955 Cr
Grand Total - 20511.98 Cr
In addition to the above, the Government also proposed for:
Green Bonus /Incentive: in view of the pioneering efforts in preserving Himalayan Ecology and to maintain 82% of forest coverage.
Peace Bonus /Incentive: Despite having three International Borders, the State Government has been able to maintain absolute peace and tranquillity with no insurgency
The Hon’ble Chairman of the 14th Finance Commission Dr. Y.V. Reddy, in his address, complimented the State Government for the steady progress made in various sectors like tourism, forestry, human resourse development. He stated that the Commission have noted the proposals and demands of the Government of Sikkim and would deliberate on them. He also suggested the need to continue the process of discussions through subsequent representations.
Following are comments made by the Hon’ble Chairman:
1. Sikkim is the fastest growing and a leading State of the Country
2. Devotion to uplift the underprivileged is well known and deeply appreciated in the Country
3. The insights provided by the State and the Chief Minister is deeply valued
4. Sikkim is the witnessing inclusive and participatory development
Subsequently, Members of the 14th Finance made their individual observations. They are as follows:
Professor Abhijit Sen- Sikkim has recorded the 2nd highest GDP Growth rate in the Country
Ms Sushmanath
1. Sikkim exemplifies how a State can sustain development in the fields of agriculture, education, environment and health.
2. Sikkim is a very diligent State in the Union of India. It has always made efforts to be in the forefront
Dr. Sudipto Mandal
1. A well governed, advanced and forward looking State
2. Second richest State in terms of per capita income
Dr. M Govinda Rao
Sikkim is one of the most promising State in the Indian Union.
A.N. Jha
Pedestrian Footpaths in the State is commendable and is a unique feature of Sikkim
Later, the 14th Finance Commission interacted with the representatives of local bodies, political parties and trade and industry associations.
The meeting concluede with vote of thanks proposed by Principal Secretary Finance department, Mr M.G. Kiran.
As per latest information received from the Government of India, the Ministry of Road Surface and Transport has recognized Sikkim as the least accident-occurring state in the Country.
By bankbazaar | Bankbazaar.com – Thu 23 Jan, 2014 6:20 PM IST
This note has the year of printing clearly printed in the middle of the bottom row on the backside.
This note has the year of printing clearly printed in the middle of the bottom row on the backside.
An old (pre-2005) note without the year of printing. (RBI website)
