16th Finance Commission Visits Gujarat

The Commission Considers Submissions from States and Union Territories Before Finalising the Report, Which Will Cover a Five-Year Period Beginning on 1 April 2026

Finance Commission Meeting Concludes in Gandhinagar with Chief Minister Shri Bhupendra Patel, Finance Minister Shri Kanubhai Desai, and Senior Secretaries in Attendance

Suggestions from Chief Minister Shri Bhupendra Patel

– The Commission should reward States that maintain fiscal prudence
– Gujarat is experiencing rapid urbanisation alongside the unique needs and realities of tribal communities in rural areas. It is essential to prioritise these realities in the funding allocated to Gujarat
– To achieve the ambitious goals of Viksit Gujarat for a Viksit Bharat @2047, essential resources and support are expected
– The Finance Commission should help enhance the financial stability of states that are making good progress, including Gujarat
– The focus should be on performance indicators that reflect state efficiency and outcomes

Dr. Arvind Panagariya, Chairman of the 16th Finance Commission, appreciates Gujarat’s economic progress

Chairman, 16th Finance Commission

– Gujarat’s average growth rate stands at 8.5 per cent, compared to the national average real GDP growth rate of 6% over the past ten years
– With a development strategy focused on manufacturing, Gujarat positioning itself to become India’s equivalent of South Korea or Taiwan
– Gujarat has achieved steady growth throughout the challenging period of COVID

Gandhinagar : During the 16th meeting with the Finance Commission, Chief Minister Shri Bhupendra Patel asserted that the Commission should reward states like Gujarat, which maintain disciplined fiscal prudence. This recognition would acknowledge responsible financial management and efficient expenditure, motivating other states to adopt similar practices.

The 16th Finance Commission report, covering the five years beginning on 1 April 2026, is scheduled to be available on 31 October 2025. In this regard, the 16th Finance Commission is on a visit to Gujarat for detailed discussions with state authorities before finalising its report.

Commission Chairman Dr Arvind Panagariya, along with four members, held discussions with Chief Minister Shri Bhupendra Patel, Finance Minister Shri Kanubhai Desai, Chief Secretary Shri Raj Kumar, and senior secretaries of the state government.

During the meeting, Chief Minister Shri Bhupendra Patel emphasised Gujarat’s strong capability in achieving Prime Minister Shri Narendra Modi’s vision of ‘Viksit Bharat @ 2047.’ The Chief Minister conveyed his expectation for sufficient resources and support from the central government to achieve these aspirational goals. In this regard, he recommended that the Finance Commission should focus on performance indicators that demonstrate the state’s efficiency and outcomes. Chief Minister Shri Bhupendra Patel urged the Finance Commission to consider the unique circumstances of Gujarat when determining the Commission’s funding allocations. In this context, he noted that, while urbanisation is advancing rapidly in Gujarat, tribal communities living in rural areas have their unique needs and requirements. He stated clearly that, by meeting these requirements with sufficient support from the Finance Commission, Gujarat will be well-positioned to make a significant contribution to the country’s development. The Chief Minister emphasised that the benefits provided to Gujarat by the Finance Commission should reflect these realities and align with the state’s ambitions and needs.

The Chief Minister remarked that, under Prime Minister Shri Narendra Modi’s leadership, Gujarat has experienced remarkable development over the past two decades. In 2001, the state’s contribution to the country’s GDP was over 6 per cent, and today, guided by Shri Narendra Modi, it has risen to over 8.5 per cent. The Chief Minister praised the Finance Commission for its significant contribution to the development of both the nation and its states. He viewed the Commission’s role as fundamental in strengthening cooperative federalism. In his recommendations, the Chief Minister specifically called on the Finance Commission to maintain its support and guidance for financially progressive states, including Gujarat.

Chairman of the 16th Finance Commission, Dr Arvind Panagariya, commended Gujarat’s economic progress, noting that while the national real GDP growth rate has been at an average of 6 per cent over the past ten years, Gujarat’s real GDP growth rate stands at an average of 8.5 per cent. He endorsed the state’s development strategy as a manufacturing hub, asserting that Gujarat is well on its way to becoming India’s equivalent of South Korea or Taiwan. Dr Panagariya pointed out that the groundwork for this development was laid under the leadership of former Chief Minister Shri Narendra Modi, resulting in a strong framework for growth today. He also commended Gujarat for consistently advancing its development trajectory, especially during the challenging period of Covid. Additionally, he recognized the Surat Economic Region model and the DISCOM, as presented by the Gujarat government, describing it as a role model for others to emulate.

Finance Minister Shri Kanubhai Desai emphasized the need for the Finance Commission to assess states based on their performance in key areas like renewable energy, climate change, and sustainability. Shri Natarajan, Principal Secretary of the Finance Department, delivered a comprehensive presentation on behalf of the Gujarat Government to the 16th Finance Commission, during which commission members provided their insights. The meeting was attended by Additional Chief Secretaries, Principal Secretaries, Secretaries from various departments, and Advisor to the Chief Minister Shri S.S. Rathore.

Source: Information Department, Gujarat