UPSC Mains 2021 · GS II · Q3 · 10 marks · 150 words

How have the recommendations of the 14th Finance Commission of India enabled the States to improve their fiscal position?

हिन्दी में

भारत के 14वें वित्त आयोग की संस्तुतियों ने राज्यों को अपनी राजकोषीय स्थिति सुधारने में कैसे सक्षम किया है?

Centre-State RelationsConstitutional Bodies

How a topper answered the closest question

Toppers wrote this one in a test series: “'The recommendations of the 15th Finance Commission have enabled the States to improve their fiscal conditions.' Comment.”

Ujjwal PriyankAIR 10 · CSE 2025 · 122 wordsTheir whole copy

Opening

The 15th finance Commission under N.K. Singh provided for an effective devolution of fund from centre to state as well as grant-in-aid for period 2021-26.

Body · points and prose

The recommendation have enabled state to improve fiscal conditions

  1. Better availability of funds which is about 41% of centre's divisible pool.

  2. Horizontal distribution based on various criteria :

a) Population of 2011, thus ensures funds as per need of region.

b) Ensuring reward for demographic performance. This ensures better share for Southern states of India. c) Ensuring sustainable development ↳ Funds based on Forest and ecology.

(3) Thus, various states have received funds based on their needs and aspiration, not a homogeneous scale.

Diagram
Challenges → 1. Federal tension in opposition-led state → 2. Increase in tied grants to local bodies ↳ reduces autonomy. → 3. demand for cess and Surcharge increased

Close · a summary

The recommendation of 15th finance Commission can be instrumental for fiscal health.

3 more toppers’ answers to this question, part by part, and how they all approached it: open the question.

Toppers’ answers to other close questions

Source: UPSC, Civil Services (Main) Examination 2021, General Studies Paper II, Q3. The paper on upsc.gov.in. Themes and links to toppers’ answers are by UPSC Grade, not by UPSC.