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Thursday, February 27, 2014

1. Dr. Y.V. Reddy, Chairman, Ms. SushamaNath, Dr. M. Govinda Rao and Dr.SudiptoMundle, Members of the Fourteenth Finance Commission, and Shri A.N.Jha, Secretary visited the State of Mizoram on February 26-27, 2014 to hold consultations with the State Government and key stake holders.

2. The Commission met with the Hon’ble Chief Minister, his cabinet colleagues and senior officers of the State Government, for discussions.

3. The Chief Minister in his speech welcomed the 14th Finance Commission and highlighted the impressive GSDP growth attained by the State along with attaining high HDI. He also highlighted the deep structural imbalances in terms of poor infrastructure leading to poverty and unemployment. He stated that though the State had made efforts to raise its own tax and non-tax revenues in the recent years, it would require assistance in the form of higher tax devolution and grants for the State. He requested that cess and surcharges be made part of the sharable pool. At the same time, he requested that the aggregate share of States be increased to 50%. To address horizontal imbalances, he requested that the minimum floor rate for each Special Category State be fixed at at least 1%. He highlighted the forest coverage in the State and sought funds for its preservation and regeneration. Considering the huge cost disability suffered by the State, he requested the Commission to provide 60% step-up over agreed norms for the Special Category States. The Chief Minister also referred to the high debt owned by the State and requested that the debt taken by the State during the award period of the Twelfth Finance Commission be written off and kept in a separate fund to be used solely for repayment of the state development loans.

4. The Chief Minister also requested for higher devolution for the local bodies along with the ADCs. For addressing the special problems and for the upgradation of administrative infrastructure he requested for Rs.8047 crores.

5. The State Government submitted its Memorandum and made a detailed presentation on the finances of the State Government, its projection for the award period and gave its views on some of the Terms of Reference of the Commission. The Commission also interacted with representatives of Political parties, Panchayati Raj Institutions, Urban Local Bodies, Autonomous District Councils, Trade & Industry Associations and NGOs.

6. The Commission placed on record its appreciation to the Chief Minister and State Government for the cooperation and support extended to the Commission and assured that the issues raised would receive due attention in the deliberation of the Commission. The Commission also looks forward to continuing interaction with the State Government.

7. The Commission will finalize its recommendations by October 2014 after completing its discussions with all the State Governments, the Government of India and relevant stake holders.

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