Faculty Coordinator: Dr. Sumalatha B S

Faculty Team: Smt L Anitha Kumary, Dr. Kiran Kumar Kakarlapudi, Dr. Nirmal Roy V P, Dr. Vidya V Devan & Dr. Meenu Mohan

Understanding the distribution of fiscal powers in a federal system requires a deep dive into a nation’s historical context, as it’s not just about dividing taxes and spending, but rather a consequence of the political reasons for forming a federation. This foundational understanding is crucial for any meaningful cross-country comparison. Fiscal federalism analyses how revenue and expenditure responsibilities are split between different government levels to allocate resources and address regional disparities. In India, a key challenge is the mismatch in revenue sharing between the union government and states. Comparing how countries like the USA, Australia, Germany, and Canada handle these imbalances can offer valuable insights for India. In this pillar the key areas for further research include intergovernmental transfers, which aim to redistribute resources and bridge fiscal imbalances between government tiers, and fiscal decentralisation, which promotes efficiency by tailoring policies to local needs while balancing central control for macroeconomic stability. India’s decentralisation efforts face hurdles due to limited fiscal autonomy for states. Finally, fiscal consolidation under rule-based regimes examines how legislative frameworks for public finance, like those in India since the 2000s, impact fiscal health across different government levels and their alignment with constitutional provisions.