Noted economist and Columbia University professor, Arvind Panagariya, is appointed by Central Government as the chairman of the 16th Finance Commission. Dr. Panagariya has held the position of vice-chairman of NITI Aayog earlier.
The Gazette Notification dated December 31, 2023 said, “In a move aligned with Article 280(1) of the Constitution and the Finance Commission (Miscellaneous Provisions) Act, 1951 (33 of 1951), the President has established a Finance Commission. Dr. Arvind Panagariya, former Vice-Chairman of NITI Aayog and Professor at Columbia University, assumes the role of Chairman” The notification also said that other members of the Commission members will be notified separately. The tenure for the commission shall be from the assumption of office until the submission of the Report or October 31, 2025, whichever comes earlier.
Dr Panagariya was the choice of PM Narendra Modi as the first Vice Chairman of the NITI Aayog when in 2015, the new Government under Narendra Modi ushered in radical policy changes, discarding of Planning Commission being one of the major ones. 1952 born Dr Panagariya, a top economist is having work experience with Asian Development Bank, the World Bank, the International Monetary Fund, and the World Trade Organization. A flagbearer of free-market economics Panagariya is known to have ideological alignment with the Modi government’s policies. During his tenure as the Vice Chairman of the NITI Aayog from January 2015 to August 2017, he also acted as India’s G20 Sherpa.
As per the terms of reference (ToR), the 16th Finance Commission would make recommendations for five years starting April 1, 2026 and submit its report for the five-year period (2026-27 to 2030-31) to the President of India by October 31, 2025.
The finance commission suggests the tax devolution between the central & state governments and measure to improve revenue generation. It also looks into the present arrangements for funds constituted under the Disaster Management Act, 2005 and the disaster management initiatives.
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