In any case, from the perspective of economic objectives, there is no justification in using 1971 population data as a factor in the horizontal distribution of funds. From a political perspective, the use of 1971 population data will result in losers and gainers. As pointed out by the Sixth Finance Commission, “It is misleading to speak in terms of redistribution of resources between the Centre and States. The ToR of the Ninth Finance Commission had raised considerable disquiet among States when it was asked to adopt a normative approach. M. Govinda Rao, Emeritus Professor, National Institute of Public Finance and Policy, was a member of the Fourteenth Finance Commission.

Source: The Hindu April 15, 2018 18:33 UTC