Goa seeks 4-fold hike in share from divisible pool, Rs 32,746 crore for 13 major projects

Panaji: The state government on Thursday made a strong pitch before the 16th Finance Commission for a significant increase in its share of the divisible pool—from the current 0.386% to 1.76%.

This request, which would represent a four-fold increase compared to the last Finance Commission’s allocation, is accompanied by a demand for Rs 32,746 crore in state-specific grants to fund 13 major projects across various sectors.

The commission, led  by Dr Arvind Panagariya, met with state officials in Dona Paula to discuss Goa’s financial needs.

Chief Minister Pramod Sawant, along with cabinet ministers and the Chief Secretary, presented a detailed account of the state’s fiscal requirements.

During the discussions, Goa’s officials emphasised the need for a four-fold boost in the state’s share of funds from the divisible pool—the portion of the Centre’s gross tax revenue shared with states.

In a media briefing following the meeting, the commission chairman confirmed that the state asked for an increase in its share from the current 0.386% to 1.76%, a figure that would effectively quadruple its allocation compared to the last Finance Commission.

“This represents a practical four-fold increase in Goa’s share,” said Dr Panagariya.

In addition to the increase in the divisible pool share, Goa has requested Rs 32,706 crore for 13 state-specific projects across various sectors, to be allocated as grants.

Dr Panagariya said the state proposed an increase in the Centre’s share to the states, suggesting a rise from 41% to 50%. He noted that this request echoed a common theme in other states, with 14 out of the 15 states visited by the commission so far making similar requests. Only one state suggested a slightly lower increase to 45%.

In terms of devolution criteria, Goa has asked the commission to reduce the weightage given to the ‘income distance’ criterion from 45% (as recommended by the 15th Finance Commission) to 30%. The state has proposed that the reduction—amounting to 15%—should be redirected to Sustainable Development Goals (SDGs) and fiscal efforts, with 12.5% allocated to SDGs and the remaining 2.5% for fiscal performance incentives.

The panel chairman explained that the ‘income distance’ criterion was designed to promote equity, ensuring that poorer states receive a larger share of the resources.

Addressing concerns about the potential diversion of funds allocated under the Finance Commission, Dr Panagariya remarked that if funds were earmarked for specific projects, they should be used accordingly.

He stressed that the public must choose between “freebies” and essential infrastructure improvements, such as better roads, drainage systems, and water supply.

“In a democracy, the elected government has the final say on how funds are used. The Finance Commission can only provide recommendations based on the macroeconomic interest of the country, but it cannot dictate how states spend the allocated money,” he said.

Dr Panagariya also pointed out that the ultimate responsibility lies with the citizens, who elect their governments based on priorities. “If citizens vote for a government that promises freebies, that’s the outcome they are choosing. Ultimately, the decision rests with the people on whether they want better infrastructure or just cash transfers,” he added.

The meeting also saw the participation of the commission’s members, including Dr Soumya Kanti Ghosh, Annie George Mathew, Ajay Narayan Jha, Dr Manoj Panda, secretary Ritvik Pandey, joint secretary Rahul Jain, and Goa’s Chief Secretary Dr V Candavelou.