Indian Subnational Finances: Recent Performance

Author/Editor:

Ananthakrishnan Prasad ; Adarsh Kishore

Publication Date:

August 1, 2007

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

The fiscal performance of the States in India has been an area of concern for quite some time. The Twelfth Finance Commission (TFC) recommended a three-pronged strategy to alleviate States' fiscal distress, built around greater orientation toward market discipline, incentives for fiscal consolidation targets, and commitment to fiscal correction. We find that States have created fiscal space through raising revenues and reducing and reprioritizing expenditures. Looking ahead, expansion of fiscal space is essential to meet the States' large infrastructure and social needs in order to alleviate bottlenecks to growth. This needs to be accomplished without undermining fiscal sustainability.

Series:

Working Paper No. 2007/205

Subject:

Budget planning and preparation Expenditure Fiscal consolidation Fiscal policy Government debt management

English

Publication Date:

August 1, 2007

ISBN/ISSN:

9781451867695/1018-5941

Stock No:

WPIEA2007205

Pages:

30

Please address any questions about this title to publications@imf.org