Consider the following statements regarding "Fiscal Federalism" : (i) Fiscal federalism involves…
Fiscal federalism addresses BOTH vertical fiscal imbalances (between the Centre and States) and horizontal fiscal imbalances (among different States) (so i is false). In…
Choose your answer
Consider the following statements regarding "Fiscal Federalism" :
(i) Fiscal federalism involves examining and stabilizing only the vertical imbalances in centre state financial relations.
(ii) Vertical imbalances are generally stabilized through various types of transfers and in Indian context these issues are examined by the NITI Aayog.
Which of the statements given above is/are correct ?
Answer and explanation
Correct answer D
Fiscal federalism addresses BOTH vertical fiscal imbalances (between the Centre and States) and horizontal fiscal imbalances (among different States) (so i is false). In India, constitutional fiscal transfers to correct vertical and horizontal imbalances are primarily recommended by the Finance Commission under Article 280, not NITI Aayog (so ii is false).
Practice for these exams
-
RPSC School Lecturer (Sanskrit Education)