NITI Aayog says devolution of funds to states should be based on performance indicators
Rajiv Kumar said that while fiscal irresponsibility is bad, "fiscal fetish" is also not desirable and a delicate balance has to be maintained. "I think it is clear that these (devolution of funds) criteria has to include some performance based criteria. And therefore those states which have done better in certain performance should not be punished. "...I think it is better deal now to start process of building some performance indicators for the devolution of funds and then increase it in phased manner," the NITI Aayog vice chairman said
Rajiv Kumar also pointed out that certain expenditures such as those for health and education could be viewed as capital expenditure as they promote productivity gains in the long run. Image source: PTI