ITANAGAR, 2 Feb: Deputy Chief Minister Chowna Mein on Monday said the union budget would strengthen fiscal federalism by retaining 41 percent vertical devolution of central taxes to states, as recommended by the 15th and 16th Finance Commissions, ensuring stability and predictability in states’ finances.
“The continuation of 41 percent vertical devolution of central taxes reflects the Centre’s commitment to fiscal federalism and cooperative governance,” Mein said in a statement, adding that the devolution provides states with assured resources to plan and execute development programmes effectively.
Highlighting the allocations for Arunachal Pradesh, the deputy chief minister, who also holds the finance, planning and investment portfolios, said that under the budget estimates (BE) 2025-26, the state has been allocated Rs 24,992.35 crore with a horizontal share of 1.757 percent.
“In the revised estimates (RE) 2025-26, the allocation stands at Rs 24,474.51 crore, reflecting a marginal adjustment,” he said.
Referring to the upcoming fiscal, Mein stated that for BE 2026-27, Arunachal has been allocated Rs 20,665.48 crore, with a revised horizontal share of 1.354 percent under the 16th Finance Commission.
He explained that the relatively higher share under the 15th Finance Commission has taken into account the state’s unique circumstances.
“Arunachal Pradesh’ vast geographical expanse, difficult terrain, sparse population, strategic international borders and high infrastructure costs were recognised earlier,” Mein said.
The 16th Finance Commission has revised the horizontal share based on updated criteria and data, but the crucial 41 percent vertical devolution remains intact, he added.
The deputy chief minister further pointed out that the Union Budget 2026-27 has made substantial provision for states through Finance Commission grants.
“Around Rs 1.4 lakh crore has been provided as Finance Commission grants to states, including support for rural and urban local bodies and disaster management,” he said, adding that it would significantly strengthen grassroots-level service delivery in Arunachal.
Reiterating the state government’s approach, Mein said that state government remains committed to prudent fiscal management and effective utilisation of resources.
“The state government will continue to work closely with the Centre to ensure that Arunachal Pradesh’s development priorities move forward with strength, balance and sustainability,” he added. (PTI)
