Stalin meets 16th Finance Commission, seeks steps to boost federal structure

The commission, formed under Article 280 of the Constitution, is the body that decides the distribution of funds between the Centre and the states.

While addressing a gathering at the state Secretariat in the morning, Stalin said he hopes that recommendation made by the commission helps in strengthening India’s federal structure and in turning it into a developed nation.

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“On behalf of Tamil Nadu and the people of the state, I am happy to welcome the 16th Finance Commission Chairman and its members. I believe the 16th Finance Commission recommendations should fulfil the expectations of all Indian states and would play a role changing India as developed country in the world. The recommendations from the 16th financial commission should strengthen India’s federal structure,” he said.

A 12-member team headed by Panagariya landed in Chennai on Sunday and met former RBI governor C Rangarajan to deliberate upon various issues.

The commission, later in the day, is scheduled to hold separate consultations with representatives of industry and trade associations, local bodies, and top political parties. The team will also go on an inspection tour of the Nemli desalination plant, housing units in Sriperumbudur and the Rameshwaram temple.

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The commission will be reviewing the fiscal distribution between the Centre and the states for five years stating 2026. The team will study tax devolution framework, grants-in-aid disbursal norms, disbursal of funds to rural and urban local bodies and review the 2005 Disaster Management Act financing to arrive on a decision.

The commission is scheduled to submit its report covering fiscal distribution and grants for 2026-2031 by October 31, 2025.