期刊名称：International Journal of Economics and Business Modeling
印刷版ISSN：0976-531X
电子版ISSN：0976-5352
出版年度：2011
卷号：2
期号：2
页码：108-117
语种：English
出版社：Bioinfo Publications
摘要：The real challenge of any federation is to eliminate intra-regional vertical and horizontal fiscal inequalities. During the last decade disparity between Centre and the States and among the States increased, and became economically and politically important. This situation resulted due to globalization and privatization. Here in this context the role of government and other financial institutions increased and has to work according to changing phase. The Fiscal and Monetary Policies need to be modified and some major reforms are must to accelerate the path of economic development. In India the major normative concern of policy structuring is equality and efficiency. The aim of this paper is to focus on role of grants-in-aid (GIA) devolution from Finance Commission (FC) to States and to study the rationale, trend and prospects for balancing the fiscal imbalance through this mode. Secondary data has been used in this study. . In few FCS GIA transfers favor developed states which are issues of great concern. No single policy can be very effective for a very long period in vibrant large and variegated country like India. The paper recommends for increasing the share of GIA to all backward States to reduce vertical and horizontal fiscal imbalances for overall economic development and optimizing social welfare of the entire economy .The parameters to judge the needs of the states should be made mainly on population below poverty line (BPL) and the stage of development of the concerned state. The remedial measures are suggested for policy reforms.
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