Panagariya to head 16th Finance Commission

Syllabus: GS-II

Subject: Indian Polity and Constitution

Topic: Appointment to various Constitutional Posts, Powers, Functions and Responsibilities of various Constitutional Bodies.

Context: The Finance Ministry on Sunday notified President Droupadi Murmu’s order for Mr. Panagariya’s appointment as the chairman of 16th Finance Commission.


  • The commission will recommend the tax revenue sharing formula between the Centre and States for the five year period beginning April 2026.
  • Panagariya, had served as the first Vice Chairman of the NITI Aayog, which replaced the Planning Commission, from 2015 to 2017.
  • The names of the members of the commission will be notified separately, says the order.
  • Term: Upto the date of the submission of report or October 31, 2025, whichever is earlier.
Article 280:·       Mandates the president to constitute a finance commission every five years.

·       Composition: Chairman and four other members.

·       Includes the duty of the commission to recommend to the president.

·       Empowers Parliament to decide the qualifications of members to be appointed. In consonance Finance Commission 1952 Act          was passed.

Conclusion: The recommendations of Finance Commission are not binding in nature and It is up to the Union government to implement its recommendations on granting money to the states.

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