UPSC Exam > UPSC Questions > With reference to the 15th Finance Commissio...
Start Learning for Free
With reference to the 15th Finance Commission recommendations, consider the following statements:
1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by
2025-26.
2. The Commission has used both the 1971 and the 2011 populations to calculate the states’
shares, giving greater weight to the 2011 population.
Q. Which of the statements given above is/are correct?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'A'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Most Upvoted Answer
With reference to the 15th Finance Commission recommendations, consid...
- Statement 1 is correct. The Commission has suggested that the centre bring down the fiscal deficit to 4% of GDP by 2025-26. For states, it recommended the fiscal deficit limit (as % of Gross State Domestic Product) of 4% in 2021-22 and 3% during 2023-26.
- Statement 2 is incorrect. The Commission has considered the 2011 population along with forest cover, tax effort, area of the state, and demographic performance to arrive at the states’ share in the divisible pool of taxes. The previous FC used both the 1971 and the 2011 populations to calculate the states’ shares, giving greater weight to the 1971 population as compared to the 2011 population. However, 15th FC did not use 1971 population data. Knowledge Base: The Commission has reduced the vertical devolution, i.e., the share of tax revenues that the Centre shares with the states, from 42% to 41%. The adjustment of 1% is to provide for the newly formed union territories of Jammu and Kashmir, and Ladakh from the resources of the centre.
- For allocation between the states (horizontal devolution), it has suggested 12.5% weightage to demographic performance, 45% to income, 15% each to population and area, 10% to forest and ecology and 2.5% to tax and fiscal efforts.
Free Test
FREE
| Start Free Test |
Community Answer
With reference to the 15th Finance Commission recommendations, consid...
Statement 1: The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by 2025-26.
The 15th Finance Commission has indeed recommended that the central government bring down the fiscal deficit to 4% of GDP by 2025-26. This is an important recommendation as it focuses on improving the fiscal health of the country by reducing the deficit. The fiscal deficit is the difference between the government's total expenditure and its total revenue (excluding borrowing). A higher fiscal deficit indicates that the government is spending more than it is earning, which can have negative consequences for the economy such as inflation and increased debt burden. By recommending a target of 4% of GDP, the Commission aims to ensure that the government's expenditure is sustainable and does not lead to macroeconomic instability.
Statement 2: The Commission has used both the 1971 and the 2011 populations to calculate the states' shares, giving greater weight to the 2011 population.
This statement is incorrect. The 15th Finance Commission has used only the 2011 population data to calculate the states' shares. The Commission has departed from the practice of using the 1971 population, which was followed by the previous Finance Commissions. The decision to use the 2011 population data was taken to address the issue of population growth and ensure a fair distribution of resources among states. By using the 2011 population, the Commission aims to incentivize states to control their population growth and promote balanced development across the country. This change in population data has led to a shift in the allocation of resources, with states that have successfully controlled population growth receiving a larger share of funds.
To summarize, the correct answer is option 'A' as only statement 1 is correct. The 15th Finance Commission has recommended that the central government bring down the fiscal deficit to 4% of GDP by 2025-26, but it has used only the 2011 population data to calculate the states' shares, not both the 1971 and 2011 populations.
The 15th Finance Commission has indeed recommended that the central government bring down the fiscal deficit to 4% of GDP by 2025-26. This is an important recommendation as it focuses on improving the fiscal health of the country by reducing the deficit. The fiscal deficit is the difference between the government's total expenditure and its total revenue (excluding borrowing). A higher fiscal deficit indicates that the government is spending more than it is earning, which can have negative consequences for the economy such as inflation and increased debt burden. By recommending a target of 4% of GDP, the Commission aims to ensure that the government's expenditure is sustainable and does not lead to macroeconomic instability.
Statement 2: The Commission has used both the 1971 and the 2011 populations to calculate the states' shares, giving greater weight to the 2011 population.
This statement is incorrect. The 15th Finance Commission has used only the 2011 population data to calculate the states' shares. The Commission has departed from the practice of using the 1971 population, which was followed by the previous Finance Commissions. The decision to use the 2011 population data was taken to address the issue of population growth and ensure a fair distribution of resources among states. By using the 2011 population, the Commission aims to incentivize states to control their population growth and promote balanced development across the country. This change in population data has led to a shift in the allocation of resources, with states that have successfully controlled population growth receiving a larger share of funds.
To summarize, the correct answer is option 'A' as only statement 1 is correct. The 15th Finance Commission has recommended that the central government bring down the fiscal deficit to 4% of GDP by 2025-26, but it has used only the 2011 population data to calculate the states' shares, not both the 1971 and 2011 populations.
Attention UPSC Students!
To make sure you are not studying endlessly, EduRev has designed UPSC study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in UPSC.
|
Explore Courses for UPSC exam
|
|
Similar UPSC Doubts
Top Courses for UPSCView all
With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer?
Question Description
With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer?.
With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer?.
Solutions for With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for UPSC.
Download more important topics, notes, lectures and mock test series for UPSC Exam by signing up for free.
Here you can find the meaning of With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer?, a detailed solution for With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice With reference to the 15th Finance Commission recommendations, consider the following statements:1. The Commission has recommended that the centre bring fiscal deficit to 4% of GDP by2025-26.2. The Commission has used both the 1971 and the 2011 populations to calculate the states’shares, giving greater weight to the 2011 population.Q. Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice UPSC tests.
|
|
Explore Courses for UPSC exam
|
|
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup