In News

• Former Finance Commission Chairman Vijay Kelkar has pitched for setting up of a ‘new NITI Aayog’ and giving it the responsibility for allocating capital and revenue grants to the States.

Explained

• Kelkar, in a paper titled ‘Towards India’s new fiscal federalism,’ said it was desirable that a functionally-distinct entity such as the new NITI Aayog be put to use to do the job at hand related to the structural issues, including removal of regional imbalances in the economy. The eminent economist, however, added that he was not suggesting for a moment that the new NITI Aayog should take the form of the erstwhile Planning Commission.
• Mr. Kelkar argued that replacing the Planning Commission, which was promoting regionally-balanced growth in India, with the NITI Aayog, a think tank, has reduced the government’s policy reach. He also suggested that to make the Aayog more effective, “the vice-chairman of the new NITI Aayog will need to be a permanent invitee of the Cabinet Committee on Economic Affairs.