Punjab chief minister, Parkash Singh Badal on Thursday urged the 13th Finance Commission to grant a ?special agriculture and industry package? to the state considering the contribution of Punjab to the national food kitty as well as the constraints suffered by it due to industrial concessions given to the neighbouring states.
He also requested the Commission to enhance the states? share of the divisible pool of taxes to 45% and enhance the limit of total transfers to 50%.
In a meeting with members of the thirteenth Finance Commission, Badal highlighted the vital role played by Punjab in ensuring the nation?s food security. He pointed out that the state was battling against a burdensome legacy inherited from the eighties, which has resulted in it becoming one of the slowest growing states in India.
?Our industrial base has been eroded due to tax concessions given to neighbouring states. The canal system of the state requires intensive rehabilitation. Its agriculture productivity is affected by waterlogging in some areas and overdrawal of ground water in other areas. Consequently the state, which was at one time the fastest growing state in the country is now growing far below the national average?, Badal said.
Badal also called for recasting the formula for devolution of central funds to the states to make it commensurate with the contribution of each state to the central taxes rather than making it dependent on the size of population or geography. He stated that the percentage of scheduled caste population in the state should be given minimum 15% weightage while 10% weightage should be accorded to the international border while devising an objective formulae for devolving funds to the states.
Highlighting the grim financial scenario of the Panchayati Raj institutions and municipalities, Badal urged the Commission to provide Rs 5,000 crore during 2010-15 for provision of civic infrastructure in rural areas of the State, besides Rs 4,600 crore for five year period to meet 75% of the cost of development works in urban areas like roads and bridges, water supply, sewerage system, and sewerage treatment plant . He however, said that the 73rd and 74th Constitutional Amendment Acts, 1992 constituted an important milestone in the history of democratic decentralisation but in true spirit the commission should dole out funds liberally to the state to make the PRIs and local bodies fiscally and economically viable and sustainable.
Badal said that in the matter of tax devolution, the past Finance Commissions have not fully recognised the expenditure commitments of the states and not recommended a fair share to them. The Eleventh Finance Commission recommended the states? share at 29.5% and the Twelfth Finance Commission increased it marginally to 30.5%.
He strongly pleaded that the percentage share of states in the net proceeds of Central Taxes should be fixed at 45% for the period 2010-15 from the prevailing 30.5%. The total transfer to the states should be at least 50 % against 38% of the Central gross revenue receipts under the Twelfth Finance Commission.