Big decision of Modi Government, Arvind Panagariya made the chairman of 16th Finance Commission

On Sunday, December 31, the Central Government has handed over a big responsibility to former Vice Chairman of NITI Aayog, Arvind Panagariya. The Central Government has appointed Arvind Panagariya as the Chairman of the 16th Finance Commission. The Central Government issued a notification in this regard saying that Ritwik Ranjan Pandey, Joint Secretary in the Finance Ministry, will take over the responsibility of the post of Secretary of the Commission. In the notification issued by the government, it has been said that the President is appointing former Vice Chairman of NITI Aayog and Professor of Columbia University, Dr. Arvind Panagariya as the Chairman. Along with this, he is also happy to constitute the Finance Commission. The members of the newly constituted commission will also be notified separately.

Let us inform you that the newly constituted Finance Commission will give recommendations for the next 5 years from April 1, 2026. This commission has to submit its report to the President by 31 October 2025. Let us tell you that the Finance Commission suggests measures to increase revenue between the Center and the State. Apart from this, there will also be the responsibility of reviewing the current system of funding for disaster management. It is noteworthy that Finance Commission is a constitution and an institution. Its main function is to give suggestions on financial relations to the Center and the State.

The Commission will submit its report for the five-year period (2026-27 to 2030-31) to the President by October 31, 2025. The Union Cabinet chaired by Prime Minister Narendra Modi had last month approved the Terms of Reference (ToR) of the 16th Finance Commission. The Finance Commission will review the current arrangements for financing disaster management initiatives besides suggesting tax devolution and revenue enhancement measures between the Center and states. The Finance Commission is a constitutional body which gives suggestions on Centre-State financial relations. The previous NK Singh-led 15th Finance Commission had recommended that states be given 41 per cent of the Centre’s divisible tax pool during the five-year period 2021-22 to 2025-26.

Know about Dr. Arvind Panagariya
Dr. Arvind Panagariya was honored with the Padma Bhushan Award by the Government of India in March 2012. Born on 30 September 1952, Arvind has served in various positions in many world-class institutions like World Bank, IMF, UNCTAD. He holds a PhD degree in Economics from Princeton University. Panagariya has also been a member of the International Advisory Board of the Securities and Exchange Board of India. Recently he has been appointed Chancellor of Nalanda University.