Finance Commission Meets RBI Governor, Discusses Setting Up State-Level Commissions
The 15th Finance Commission deliberated on the need to set up state-level panels during its meeting with the Reserve Bank of India Governor Shaktikanta Das and other senior functionaries of the central bank.
The other issues which came up for discussion during the meeting in Mumbai include public sector borrowing requirements, continuity of the Finance Commission and development of expenditure codes, especially given that norms vary from state to state.
On the continuity of the Finance Commission, an official statement said in the meeting it was “felt that this was required more in view of the fiscal management requirements of the states, especially given the absence of mid-term reviews of awards granted by the Finance Commission, as it used to happen earlier with the awards granted by the Planning Commission”.
The RBI made presentations to the Finance Commission on state Government Finances for 2019-20 and also on the issues and challenges of market borrowings of state governments.
The main issues raised by the RBI included increasing orientation of state governments borrowing to markets, and improving secondary market liquidity.
During its two-day visit to Mumbai, the 15th Finance Commission, chaired by NK Singh, is slated to have meetings with banks, financial institutions and economists as well.