16th Finance Commission report raises equity concerns

The 16th Finance Commission's report, covering 2026-31, retains vertical devolution at 41% but sharply cuts grants-in-aid, eliminating revenue deficit and state-specific grants. Critics argue this prioritizes efficiency over equity, undermining the Commission's constitutional role in addressing inter-state disparities. The report assumes uniform fiscal capacity, which experts say is untenable given the diverse needs of states like Kerala, Punjab, and the northeast.