Finance Minister Arun Jaitley on Saturday asked the states to focus more on infrastructure development which is holding back India’s economic growth.
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“We expect that those states whose resources have been increased after the implementation of the 14th Finance Commission will spend further on infrastructure creation and anti-poverty programmes since their incomes have increased considerably”, Jaitley told reporters here.
The finance minister also said that the Centre will give more incentives to the agricultural sector for boosting production.
He explained the world economy is now moving via a challenging stage and it is very delicate, incorporating that ” Indian economy has the capacity to arise as you of the fastest-growing establishments on the planet, although Asia, particularly exports has likewise influenced”.
During the meeting, majority of states demanded the government to release the long pending compensation for phasing out Central Sales Tax (CST) and provide for such funds in the upcoming Budget.
The Fourteenth Finance Commission had a year ago recommended a 10 per cent increase in the states’ share in the Union taxes to 42 per cent. The Seventh Pay Commission has recommended 23.55 per cent overall hike in pay, allowances and pensions of government employees with effect from January 1, 2016.
“I request the Union Finance Minister to make adequate provision for CST compensation either in the Supplementary Estimates for 2015-16 or in the forthcoming budget”, Tamil Nadu Minister for Finance and Public Works O. Panneerselvam said in his speech. “Several conditionalities that made the investment process more hard, even those conditionalities have also been sliced away”, he said.
“But resources of states have also increased after the 14th Finance Commission”.
The Congress has stalled the passage of the constitutional amendment Bill, derailing the government’s plan to roll out GST from April 1, 2016.
The finance minister pointed out that agriculture growth in the last two years has suffered due to insufficient monsoons.
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Amat also pressed for implementation of 14th Finance Commission recommendations, which will enhance market borrowing limits of states by 0.5 percentage points from the present 3 per cent of gross state domestic product (GSDP).
