The defiant non-BJP states are in no mood to abandon their fight for more fiscal space with just a one-time meetup of state ministers in Thiruvananthapuram on Thursday. It has already been decided to hold the second Conclave of Finance Ministers at Bengaluru, Karnataka.
The first Conclave of Finance Ministers was held today, September 12, to thrash out ways to secure from the 16th Finance Commission the fair demands of states suffering under what has been termed as the fiscal authoritarianism of the Centre. The event hosted by Kerala had ministers and top officials from Punjab, Telangana, Tamil Nadu, and Karnataka.
It was Karnataka's revenue minister who spoke of the need to carry forward the initiative. He announced at the Conclave his Chief Minister Siddaramaiah's invite to all the states to a second conclave of finance ministers at Bengaluru. All the participants have agreed to the proposal. The date would be announced soon.
"Whatever exercise we are trying to do here, expressing a collective interest, making a case for justice, all of this cannot be served by a one-off effort," Byre Gowda said. "Last time we met in Thiruvananthapuram (in 2020, to come up with a sharp and collective response before the 15th FC), we had our say. But we have our say and they know what to do. The previous Finance Commission contemptuously disregarded all our concerns and went ahead and meted out gross injustice to all of us," Gowda said.
The 15thFC had not only reduced the vertical devolution to 41% from 42%, it had also dumped the 1971 census figures and instead for the first time ever adopted the 2011 census figures as an indicator to devolve funds to the states. The 2011 population measure had affected most southern states like Kerala, Tamil Nadu and Karnataka that had achieved commendable reduction in population.
"We cannot just have our say and then be dispensed with. We must be heard. That will require further efforts. Kerala did us all a favour by taking the first step," said the revenue minister, who is also a Congress leader.
The Conclave is the brainchild of former finance minister T M Thomas Isaac. "Such a gathering is the result of the vision and foresight of my 'chettan' (big brother) Thomas Isaac," Byre acknowledged Isaac's role at the Conclave today. The former FM was also a participant.
"This time, we cannot afford to be so optimistic that we come across as too naive. So we will have to continue these efforts. We would like the next event to be hosted in Karnataka, where we will crystallise the ideas that come up here and keep up the momentum for what we are seeking here," Gowda said. "We are on a quest for justice. When we meet next time, we will bring more states to the table," he said.
Former NITI Aayog Vice Chairman Arvind Panagariya was appointed the Chairman of the 16th Finance Commission in January 2024. Full-time members are Ajay Narayan Jha, former member of the 15th Finance Commission and former Secretary of the Department of Expenditure; Annie George Mathew, former Special Secretary of the Department of Expenditure; Niranjan Rajadhyaksha, Executive Director of Artha Global. Soumya Kanti Ghosh, Group Chief Economic Advisor, State Bank of India, will function as part-time member. The 16th FC has to submit its report by October 31, 2025.