Course Name: In-depth study of Centre State Relations Lesson Name: Fourteenth Finance commission - II Presented by Bhavin Sangoi
About me B.A in Political Science & Psychology Appeared in UPSC CSE Mains Teaching Indian Polity, International Relations, economics &mental Ability since 5 years Experience of teaching for various competitive exams such as NTSE, CET& UPSC Rate, Review and Recommend Follow me on: https://Unacademy.in/user/BhavinSangoi
Fiscal Consolidation Fiscal deficit for union Fiscal deficit for union government should be 3% of from the year 2016-17 to 2019-20 Rationalization of direct taxes and GST will help to eliminate revenue deficit much before 2019-20
Continued Fiscal deficit of states will be 3% GSDP. Flexibility of 0.25% can be allowed over this target for fixing borrowing limit if their debt to GSDP ratio is less than or equal to 25% in the preceding year
Additional borrowing limit of 0.25% of GSDP can be allowed to fix borrowing limit if the interest payment are less than or equal to 10% of revenue receipt of previous year
Continued The flexibility in availing the additional limit under either of the two options or both will be available to a state only if there is no revenue deficit in the year in which borrowing limits are to be fixed and the immediately preceding year
If a state is not able to fully utilise its santionced borrowing limit of 3% of GSDP in any particular year during first four year of award period (2015-16 to 2018-19), it will have the option of availing this unutilized borrowing amount(in Rupees) in the following year but within the award period of FFC
BA Political Science and Psychology, Mumbai University. Teaching Polity, Economics and international relations for 7 years.