Mumbai, Aug 14: Disappointed by the 11th Finance Commission report, Maharashtra chief minister Vilasrao Deshmukh is contemplating forming a pressure group of southern state chief ministers to further harden their protests and compel the Centre to intervene.Deshmukh, who has already spoken to the Andhra Pradesh chief minister N Chandrababu Naidu on Monday had a telephonic conversation with Karnataka chief minister SM Krishna and Kerala chief minister EK Naynar, requesting them for "united action" in this regard. Deshmukh also tried to rope in Tamil Nadu chief minister M Karunanidhi, but the latter could not be contacted. Sources close to the chief minister told The Financial Express that Deshmukh would try to unite his counterparts and lobby strongly against the commission recommendations. Deshmukh has already expressed his desire to take a delegation to the prime minister AB Vajpayee in this connection.
Deshmukh has termed the commission recommendations "discriminatory", especially to the states with good fiscal management. The 11th Finance Commission has recommended very negligible funds from the Centre's shares to states whose per capita income is high.
Deshmukh, as well as state finance minister Jayant Patil have categorically said that these recommendations would not only affect Maharashtra, but would also impact other states also. Maharashtra stands to lose heavily, as its share in a divisible pool of sharable central taxes will fall to 4.632 per cent from 6.126 per cent. The state's share would be reduced by as many as Rs 5,622 crore in 2000-05. The weightage for population has been halved by 50 per cent, as compared to other criteria fixed by the 11th Finance Commission.
The percentage for area has been reduced by 2.5 per cent and percentage for infrastructure index has been increased by an equal percentage to 7.5 per cent.
The percentage for tax efforts has been reduced by 50 per cent and the percentage in respect of per capita income and area have been increased by 2.5 per cent. "As Maharashtra's per capita income is high, the rise in percentage under this criterion has adversely affected the state's share," sources said.
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