Nagaland chief minister Neiphiu Rio on Wednesday said the state will need fund from the centre’s consolidated fund to supplement its revenues.
Holding a meeting with the Fifteenth Finance Commission team at the conference hall of the chief secretary in Kohima, Rio said the state requires lump sum amount each year for the development programme and grants-in-aid towards meeting the cost of administration.
A 14-member Finance Commission team led by its chairman N K Singh arrived in Nagaland on Tuesday on a three-day tour of the state.
The chief minister pointed out that the state’s financial position has deteriorated steadily, adversely affecting development activities, after the government of India discontinued the grant of funds to cover the balance from current revenue gap by granting additional central plan assistance during the Ninth Finance Commission period.
He added that the normative approach of the Thirteenth Finance Commission affected Nagaland by denying its special category status and any special grant or treatment due to which the state struggled to even release of pay and allowances to its employees on time.
He further stated that the revenue deficit continued on account of 10 per cent increased tax devolution to the states from 32 percent to 42 percent.
Rio requested the Commission to consider setting aside 25 per cent of the total devolution of share to the states for the Special Category states as against the 11.53 percent allocated by the Fourteenth Finance Commission which is found to be insufficient.
“Of the 25 percent, 3 percent each may be allocated to states having geopolitical implications like Nagaland,” he said.
Rio also stated that Nagaland is struggling to provide 10 percent state share for centrally sponsored schemes (CSS) and flagship schemes due to resource constraints and a huge backlog of state share amounting to Rs 294.05 Cr. Because of this, he said, the state cannot access the central share of 90 percent for these schemes which has affected the infrastructure development in the state.
He requested the Fifteenth Finance Commission to recommend cent percent central grant for funding CSS and flagship programmes as was intended in the 16-Point Agreement signed during the formation of the state.
Rio also said the state is struggling with financial burdens caused by short release of funds.
He hoped that the discussions and interactions will help the commission appreciate better the reasons and circumstances that make Nagaland unique and different from other states.
On Tuesday, the Nagaland government requested the Fifteenth Finance Commission to recommend one-time grant to waive budgetary deficit and liabilities of Rs 2864.18 Cr.
In a memorandum submitted to the commission on Tuesday evening, the government said the total deficits, including liabilities accumulated as on March 2018 was Rs 2864.18 Cr which includes Rs 1607.73 Cr budget deficit and Rs 1256.45 Cr development deficit.
The memorandum reflected the impact due to the change of funding in the previous years and a proposal for the next five years – 2020-21 to 2024-25.
The state government projected Rs 3,535.50 Cr for the five-year period for repair and maintenance, Rs 1,115.59 Cr for four hydro projects and Rs 4,392.93 Cr for critical infrastructural development.