Bhopal (Madhya Pradesh): Madhya Pradesh is set to face a potential loss of at least Rs 25,000 crore over the next five years due to changes in the 16th Finance Commission’s recommendations.
According to officials, the central tax share allocated to states has been reduced from 7.85% to 7.35%, effectively cutting half a percentage point from Madhya Pradesh’s expected funds. This reduction comes at a time when states rely heavily on central transfers for developmental projects, social welfare schemes, and infrastructure spending.
The Finance Commission has also shifted its allocation parameters, giving preference to states with higher GDP. Additionally, area-based grants have been curtailed, further limiting funds for geographically larger states like Madhya Pradesh.
Experts warn that these changes could slow down planned development initiatives and hamper the state’s ability to meet growing demands in health, education, and infrastructure sectors.
