Puducherry Chief Minister N Rangasamy on Friday urged the Union government to include the Union Territory in the terms of reference (ToR) of the 16th Finance Commission, which is slated to be formed later this year.
In his letter to Prime Minister Narendra Modi, a copy of which was released to the media today, Rangasamy also made out a strong case to include Puducherry under the scheme of "financial assistance to States for capital investment" or to include Puducherry in the grant of special package for building capital infrastructure facilities for which funds worth Rs 2,328 crore had been sought from the Centre.
The special package relates to airport expansion (Rs 425 crore), construction of Integrated Assembly complex (Rs 420 crore), upgrading infrastructure in health sector (Rs 500 crore), setting up of a State Medical University (Rs 500 crore) and setting up of a National Law University (Rs 483 crore).
Puducherry has not found a place in the ToR in all successive Finance Commissions and therefore devolution of funds has not been provided on the basis of the recommendation of the Finance Commission in the past, the Chief Minister pointed out.
"The Union Territory administration has all along been requesting the Government of India to include Puducherry in the ToR of Central Finance Commission by suitably amending Article 280(3) of the Constitution in respect of the word 'State' or a special reference may be made to the Finance Commission to include the Union Territory of Puducherry for fixing norms for devolution of Central funds as the Union Territory has all along been treated at par with States in all matters in the implementation of Central schemes relating to the FRBM (Fiscal Responsibility and Budget Management Act) norms through a fiscal road map," the letter stated.
The Chief Minister said the Central government had proposed to constitute the 16th Finance Commission shortly and as such this is the right time to submit the request afresh for the inclusion of Puducherry in the proposed Finance Commission.
Rangasamy also listed the criteria in support of his plea for inclusion of Puducherry in the Finance Commission and said Puducherry was the first Union Territory with a legislature and operating separate 'Public Account' from December 2007 as per the directions of the Home Ministry and Ministry of Finance.
The Finance Ministry permits the Union Territory Administration to avail all kinds of borrowings including open market borrowings, negotiated loan from financial institutions as applicable to states and to stand in guarantee upon the securities of the Consolidated Fund of Puducherry as per Section 48A of Union Territories Act, 1963.
Rangasamy said, in his letter, that Puducherry is also treated as a State on the lines of the funding pattern (Centre:State) of Centrally sponsored schemes (CSS) implemented in the Union Territory and is not considered for 100 percent CSS funds as was granted to the other states.
He also brought to the attention of the Prime Minister that the Puducherry administration was implementing various centrally sponsored schemes, including 37 flagship schemes being regularly monitored by the ministries concerned.
