FM Nirmala Sitharaman meets Arvind Panagariya,

Sitharaman meets Panagariya: Finance Minister Nirmala Sitharaman recently engaged in a strategic meeting with Arvind Panagariya, the Chair of the 16th Finance Commission. This meeting follows the commission's initial assembly where discussions revolved around defining its terms of reference.

The commission, led by former Niti Aayog vice chairman Panagariya, boasts notable members such as former expenditure secretary Ajay Narayan Jha, retired bureaucrat Annie George Mathew, and Artha Global Executive Director Niranjan Rajadhyaksha. Additionally, SBI Group Chief Economic Advisor Soumya Kanti Ghosh serves as a part-time member. Sitharaman's office confirmed the meeting through a post on social media.

Formed by the government on December 31, 2023, under Panagariya's leadership, the commission has been entrusted with submitting a comprehensive report to the President by October 31, 2025. This report will encompass a crucial five-year period, commencing on April 1, 2026.

The commission's mandate is extensive, covering recommendations on tax devolution between the central and state governments, proposals for revenue enhancement, and a review of the current financial framework for disaster management initiatives under the Disaster Management Act, of 2005.

As a constitutional body, the Finance Commission plays a pivotal role in shaping financial relations between the central and state governments. In the previous term under NK Singh, the 15th Finance Commission recommended a 41 per cent share of the divisible tax pool for states, a figure consistent with the 14th Finance Commission under Y V Reddy. The ongoing deliberations of the 16th Finance Commission are anticipated to influence the fiscal landscape significantly in the upcoming years.