The Narendra Modi government’s decision to amend the 15th Finance Commission’s terms of reference in order to enhance non-lapsable funding for defence and internal security has been widely panned in the media – and for good reason.
Defence and internal security should be one of the prime responsibilities of the Centre, and if the current finances of the Centre are not enough to meet those needs, it is an indicator that the money already available to the Centre is going for other purposes. Defence and internal security are not getting the kind of financial focus they need. It does not follow that states must be given a lower share of funding.
There are several logical ways to allocate more funds for defence and internal security. One is to earmark a portion of the pool of resources already available to the Centre, and ensure that the amount is spent every year before it lapses. Read More