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Central to State Transfer Central to State Transfer

Central Transfers To States In India Rewarding Performance While Ensuring Equity

The objective of this study is to analyse the design and implementation aspects of both general and specific purpose transfers in India. The recommendation of the Fourteenth Finance Commission (FFC) and even more importantly, the abolition of the Planning Commission have brought about a measure of conceptual clarity in the landscape of intergovernmental transfers.

The FFC, unlike the past Commissions, has covered the entire revenue account requirements of the States, both plan and non-plan, in its recommendations. Thus, the entire general purpose transfers are given on the recommendation of the FFC and all specific purpose transfer are
given by the concerned Central Ministries.

This study attempts to undertake an empirical analysis of the transfers system in India. The report covers discussion on the theoretical rationale for the transfer system and analysis of the structure of policies and institutions in India dealing with the transfer system. The report also makes a broad analysis of general and specific purpose transfers in the Indian context to identify the shortcomings. It also undertakes empirical analysis of the three major centrally
sponsored schemes namely, the National Health Mission (NHM), Sarva Shiksha Abhiyan (SSA) and Mahatma Gandhi national Rural Employment Guarantee Act (MGNREGA)