SHILLONG: Meghalaya Government has sought much higher devolution by way of enhanced revenue deficit grant from the 15thFinance Commission during the three-day visit of the Commission to Shillong.
Speaking to media persons, Chairman of the 15th Finance Commission, NK Singh said that Meghalaya has a feeling that following the loss of revenue on account of ban on coal mining and uncertainty in GST, they are some revenue issues which deserves attention of the Commission.
“We will look into all these and see where these issues are reversible and whether the impact can be mitigated over the time. We will consider the request for additional revenue grant looking at the fiscal space which you have,” he said while addressing a press conference here on Wednesday.
Meghalaya Government has also requested the 15th Finance Commission for vertical devolution which may be enhanced from 42 per cent to 48 per cent, adding 30 percent out of the 48 per cent should be earmarked for special category States so as to insulate the State from the volatility of the Union revenue and economy of the country that can have an impact on its revenue collection.
The State also projected a pre-devolution deficit to be 62,870 crore rupees for the period of 15th Finance Commission.
Earlier, NK Singh also expressed concern over the low GDP growth of Meghalaya saying the state GDP is just above 11 per cent whereas from the year 2011 to 2018, the state GDP came close to 5-6 per cent which is significantly below the normal GDP growth of the country and many other North Eastern states.
Asking Meghalaya to grow well above the double digit of 10.5 per cent, he added that the state needs to catch on the loss time and improve its rating in development index so that revenue streams can be enhanced and Meghalaya becomes a self-reliant state than being dependent.
“There are huge challenges but there are equal opportunities as well,” he said.
During the visit to Meghalaya, the Commission also met the trade and industries sector of the state.
According to N K Singh, most of the traders and industries in Meghalaya are seeking for better connectivity with Bangladesh through Chittagong port even as he added that the opening of the trade and commerce with Bangladesh will help not only Meghalaya but other North-eastern states as well.
He urged upon the North Eastern states to collectively take up the matter with Central Government so that the Centre takes up the matter with Bangladesh.
When asked about the State PSUs which are not yielding much benefit to the state exchequer, he added that that the most dominant issue which they face is the issue of power, adding that the Chief Minister himself has admitted that the transmission and distribution losses need to be addressed
“Unless the health of the power sector improves, the overall health of Meghalaya will remain problematic, “he said while urging Meghalaya Government to move away from fossil fuels towards renewable energy
Earlier Singh said, the State faced a series of challenges in different sectors including tax revenue, debt serving, cash-deposit ratio, health indicators, poor road infrastructure, fiscal health of PSUs including power sector besides others.
The Chairman maintained that the State Government has credible plans to improve every sphere to improve the economy through its strategies.
He, however, said that there is a need for focused and aggressive approach for attracting private investment in tourism and allied sector while laying emphasis and priority on development of renewable energy given the natural advantages of the State.
On Wednesday, the Commission met the Meghalaya Chief Minister, Conrad Sangma, representatives of the autonomous District Councils, Shillong Municipal and representatives of the industries.
Refusing to divulge the amount of money sought by the state, the Chief Minister, however, said that these are only proposal and hoped that the commission would consider the amount keeping in mind the view of the state government.
The state government submitted a memorandum to the commission highlighting the requirement.
Earlier during the day, the state government made a detailed presentation to the Fifteen Finance commission.