Bhubanewsar, 07/10/2025: On Thursday, Chief Minister Mohan Charan Majhi made a compelling case for increasing the share of states in the vertical devolution of funds from the divisible pool of central taxes from the current 41% to 50%.
Chief Minister Shri Mohan Charan Majhi has proposed a financial allocation of Rs 12,59,148 Crore from the 16th Finance Commission for 2026-31, aiming to set the state on a path to achieving ‘Samruddha Odisha by 2036’. This was shared by the CM following an in-depth discussion with Dr. Arvind Panagariya, Chairman of the 16th Finance Commission, and other commission members at the ITC Hotel in Bhubaneswar.
The 16th Finance Commission, led by Dr. Arvind Panagariya, is currently visiting Odisha from 4th to 7th February.
During the meeting, the Chief Minister detailed several critical demands, including:
- Rs 9,88,422 Crore to offset Pre-Devolution Revenue Deficit
- Rs 1,10,434 Crore for State-Specific Needs
- Rs 1,00,036 Crore as Grants to Local Bodies
- Rs 31,004 Crore for Disaster Response
- Rs 29,252 Crore for Disaster Mitigation
Speaking to the media, CM Shri Majhi emphasized the significance of the discussion, noting that it addressed various aspects crucial to the state’s development, fiscal health, and proposed fiscal transfer system. He expressed optimism that the Commission would favorably consider the state’s submissions and reflect them in their report for the 2026-31 period. Additionally, a comprehensive Memorandum outlining the state’s needs was submitted to the Commission.
The Chief Minister further highlighted the demand to enhance the states’ share in the divisible pool from 41% to 50%. He also pointed out that Odisha’s current share in the Government of India’s gross tax income is 4.528% and requested that it be increased to 4.964%. The CM proposed that the 16th Finance Commission peg combined grants for all rural and urban local bodies at 2% of the projected gross revenue receipts of the Union for 2026-31, enhancing the grants for the state’s local bodies.
Regarding the State Disaster Response Fund (SDRF), the CM stressed the need for the Central Government to bear the entire 100% of the grant, as opposed to the current 75%. Moreover, he advocated for specific purpose transfers for health, water supply & sanitation, and old age security.
Present at the meeting along with Chief Minister Shri Majhi were Chief Secretary Shri Manoj Ahuja, and Development Commissioner Smt. Anu Garg, State Finance Secretary Shri Sashwat Mishra, and other senior state officials.
